The volatility of the naira to the dollar has taken its toll on the rising cost of fuel in Nigeria among other local and international factors.
In fact, there are strong indications that filling stations across Nigeria may soon increase the pump prices of petrol.
Chinedu Okoronkwo, president of the Independent Petroleum Marketers Association of Nigeria (IPMAN), confirmed the imminent price increase due to naira depreciation.
“As long as the dollar keeps rising against the naira in the foreign exchange market, the price of fuel in the country will continue to increase,” Okoronkwo said.
Moreover, a number of other factors can influence what might be called an inevitable hike in price of the product.
Removal of subsidy
A major reason for the changes in petrol prices is the absence of subsidies on petroleum products in Nigeria.
President Bola Tinubu, in his inaugural speech, had announced the removal of the subsidy, opening the doors for market forces to determine pump prices.
This means Nigeria is now exposed to international oil prices.
Global crude oil prices
Another factor is the rise in global crude oil prices.
Brent crude, as revealled by current checks, increased from $76 per barrel in June 2023 to $86 per barrel as of Monday, August 14.
Also Read: IPMAN confirms another fuel pump price hike
This means Nigerian oil marketers looking to restock will have to pay more to import.
The landing cost of petrol has risen month-on-month, MoM, by 37.4% to N632.17 per litre in July 2023, from N460 per litre in June 2023.
