The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC), Mele Kyari, has explained the recent rise in petrol pump prices in Nigeria, attributing it to market forces. The price increase from N540 to N617 per litre reflects the dynamics of a market-regulated pricing model.

Addressing journalists after a closed-door meeting with Vice President Kashim Shettima at the State House in Abuja, Kyari emphasized that the price fluctuations are a result of market realities. He stated, “Prices will go up and sometimes they will come down also,” reaffirming the importance of allowing the market to regulate itself.

Kyari debunked notions that the price hike is due to a shortfall in petrol supply, clarifying that there is no supply issue. He asserted, “We have a robust supply. We’ve had over 32 days of supply in the country. That’s not a problem.”

Meanwhile, Farouk Ahmed, the CEO of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, also linked the price hike to global crude oil prices increase. Changes in freight costs and other miscellaneous expenses during distribution have also contributed to the price changes, according to Ahmed.

Tuesday’s development was confirmed by independent oil marketers, who noted that price adjustments by NNPC usually indicate a rise in the pump price of petrol, as NNPC remains the primary petrol importer in Nigeria. However, other marketers are gradually importing the commodity as well.

It is essential to recall that in his inaugural address on May 29, President Bola Tinubu announced the discontinuance of subsidy on petrol, which led to a significant jump in the price of the commodity from N198 per litre to over N500 per litre on May 30, 2023.

As petrol prices continue to fluctuate under market forces, the situation is being closely monitored by authorities and industry stakeholders to understand its impact on consumers and the overall economy.