The Federal Competition and Consumer Protection Commission (FCCPC) has expressed concern over the slow reduction in petrol prices across Nigeria despite a significant decline in global crude oil prices.
The commission said its market monitoring showed that fuel marketers, depot operators, refiners and filling station owners had made only slight cuts to pump prices, even though international crude oil prices have fallen sharply in recent weeks.
According to the FCCPC, consumers are not enjoying the full benefits of the drop in crude prices, raising concerns about possible unfair pricing practices in the downstream petroleum sector.
The commission’s Executive Vice Chairman and Chief Executive Officer, Tunji Bello, said while businesses in the deregulated market are free to set their own prices, they must still comply with the provisions of the Federal Competition and Consumer Protection Act by operating fairly and avoiding practices that exploit consumers.
Bello noted that marketers often increase fuel prices almost immediately whenever crude oil prices rise, but are much slower to reduce prices when global oil prices decline. He said competitive markets should respond fairly to both increases and decreases in international prices.
The FCCPC acknowledged that local fuel prices are influenced by factors such as foreign exchange rates, transportation costs, financing, refining expenses and distribution charges. However, it maintained that the scale of the recent decline in crude oil prices should have resulted in more noticeable reductions at filling stations.
Global crude prices have dropped considerably following easing tensions in the Middle East, including a ceasefire between the United States and Iran and the reopening of the Strait of Hormuz, an important oil shipping route.
Despite this decline, petrol continues to sell at around ₦1,200 per litre in many parts of Nigeria, compared to about ₦800 to ₦900 per litre earlier in the year before crude prices surged.
The commission warned that it would investigate any credible evidence of anti-competitive conduct, consumer exploitation or other violations of the law. It also urged Nigerians to report suspected cases of price manipulation and unfair market practices through its official complaint channels.
The FCCPC said its findings are expected to renew debate over the effectiveness of fuel price deregulation, as many Nigerians continue to question why lower global crude oil prices have not resulted in significant reductions in pump prices.
