Oil marketers under the aegis of Major Oil Marketers Association of Nigeria (MOMAN) and the Petroleum Marketers Association of Nigeria (DAPPMAN) have expressed discontent over the restriction of petroleum import licence to a limited number of refiners as contained in the recently passed Petroleum Industry Bill (PIB).
The decision, according to the two unions, is against the principle of fair play for a major resource that the country largely depends on, pointing out that it is a dangerous measure to adopt.
Recall that whereas the bill removes price controls on petroleum products in Section 205, the version of the bill passed by the Senate includes a clause that limits market competition by restricting the importation of petroleum products to only players with local refining capacity.
The restriction extends to products that have long been deregulated such as diesel, kerosene (HHK and ATK), LPG and base oils.
In a statement jointly signed by Clement Isong and Olufemi Adewole, for the unions, they said their members decided to advise caution for the reason that the proposed provision poses a monopoly risk that must be avoided and that it is imperative that a level-playing field is set for all operators across the value chain.
“Any provision that does not guarantee a free and open market will give room to price inefficiencies and eventually kill off small businesses in the downstream sector”, they added.
They warned that such a provision will stifle competition and leave pricing to be solely dictated by a few local refiners.
“We position that price must be kept competitive at the pump for the benefit of the average Nigerian whose income is constantly being eroded by inflation.
“Allowing imports by major players across the supply chain will protect consumers by ensuring that local pump prices are not higher than regional or international prices.
“If Nigerians are to pay higher international prices at the pump, we should also benefit when the prices go down internationally. This is not guaranteed unless there is healthy competition,” the statement said.
