Petrol prices at filling stations across Nigeria are expected to increase to over N1,000 per litre as the Nigerian National Petroleum Company (NNPC) Limited grapples with a substantial $6 billion debt. This financial strain has led to a series of challenges for the state-owned oil firm, including disruptions in fuel supply and rising costs.
NNPC’s recent admission of its debt issues has raised concerns about the company’s ability to maintain its role as the primary importer of petrol. This financial distress has exacerbated the ongoing fuel shortages across the country, with NNPC stations currently offering petrol at significantly lower prices compared to independent marketers. In Lagos, for instance, NNPC prices are as low as N564 per litre, while other areas see prices slightly above N600 per litre.
Heineken Lokpobiri, the Minister of State for Petroleum, has criticized the current pricing structure, suggesting that the low prices at NNPC stations incentivize smuggling of petrol to neighboring countries. Lokpobiri advocates for adjustments to align prices with market rates to mitigate the smuggling issue and stabilize the sector.
In response to these financial pressures, NNPC is considering halting the payment of unsustainable debts, which could further drive up petrol prices. Current reports indicate that private depots are selling petrol for between N920 and N950 per litre, reflecting the impact of rising costs on the broader market.
The potential price hike comes amidst ongoing protests and demands for the resignation of NNPC’s Group Chief Executive Officer, Mele Kyari. Critics argue that the company’s financial mismanagement has contributed to the fuel crisis, while the government is pushing for a reevaluation of pricing policies to address the smuggling and supply issues.
As the situation evolves, many Nigerians are turning to alternative fuels such as Compressed Natural Gas (CNG), which is becoming increasingly popular due to its lower cost compared to petrol.
