**Markets Take Center Stage in the Downstream Sector**
The Group Managing Director of Rainoil Ltd, Gabriel Ogbechie, has sounded the alarm for Nigerians to prepare for market-driven pricing of petroleum products in the country. This warning comes amidst the federal government’s full deregulation of the downstream sector, a move that has led to a sharp surge in the price of Premium Motor Spirit (PMS) from N175 per litre in May 29, 2023, to N1,300 per litre.
According to Ogbechie, this deregulation promotes healthy competition within the industry, commending President Bola Tinubu for his decision to eliminate fuel subsidies. He believes that this step will ultimately lead to a more efficient and effective market-driven system.
However, as the price of crude oil and the exchange rate continue to fluctuate, the prices of petroleum products will also experience similar changes. “As long as the price of crude oil keeps changing, as long as the exchange rate keeps changing, prices of petrol too will keep changing,” Ogbechie warned.
Despite the uncertainty surrounding the market, Ogbechie cautions that the price of gasoline will continue to rise, ranging from N1000 to N1060 per litre and possibly as much as N1300 per litre further north. He advises Nigerians to be prepared for market-driven prices for petroleum products.
To mitigate the impact of these changes, Ogbechie suggests that marketers and the government need to get used to the idea of market-based pricing, where the price of petroleum products is determined by the forces of supply and demand. According to him, this new system will undoubtedly lead to a more efficient and competitive market.
With the government no longer intervening to control prices, Nigerians can expect a more dynamic market where prices will be influenced by global events and market trends. As such, it is crucial for consumers to be aware of these changes and adapt to the new reality.
