The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has warned against monopolies and unfair competition in the downstream oil sector while calling for healthy competition.
National Public Relations Officer of the association, Joseph Obele, made the call in a statement on Monday.
He urged regulatory authorities to promote healthy competition and price stability in the country’s downstream petroleum sector to prevent monopolies and protect local refineries.
“The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has taken a firm stance on promoting healthy competition and controlling price fluctuations in the downstream sector,” the statement read.
PETROAN also decried the “massive” financial losses caused by the recent “sudden” drop in the price of petrol.
A silent price war has been going on between the Dangote Refinery and The Nigeria National Petroleum Company Limited (NNPCL) with each reducing the price of petrol over the past weeks.
While the retailing partner outlets of the Dangote Refinery now sell between N860 and N890 based on the state/region, with Lagos having the cheapest price, the NNPCL also reduced pump prices in its retail outlets in Lagos to N860.
However, PETROAN, said the sudden price cuts led to massive losses in billions of Naira.
“The association stressed that the sudden downward review of prices has resulted in massive losses, with those affected counting their losses in billions of naira. This situation poses a significant fear for further investment in the sector, as investors are wary of unpredictable market conditions,” a part of the statement read.
The association emphasised the need for multiple supply sources, including the Dangote Refinery, NNPC refineries, modular refineries, and imports, arguing that a diverse supply base would allow competition between local and imported petroleum products, ensure fair pricing and shield the market from exploitation.
“This diverse range of sources will foster competition, especially with imports, allowing for comparisons with international market prices and protecting the local market from exploitation,” the statement read further.
It also called on the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Federal Competition and Consumer Protection Commission (FCCPC) to be vigilant and prevent unfair competition practices.
While advocating a multiplicity of supply sources, PETROAN also sought support for local refineries, saying such support would lead to increased domestic production of petroleum products; reduced reliance on imports; creation of jobs and stimulation of economic growth; and improved energy security and reduced vulnerability to international market fluctuations.
