The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) yesterday warned against monopolies and unfair competition in the downstream oil sector amid price war in the petroleum industry.
While calling for healthy competition, he stressed the need for a stronger regulatory intervention to checkmate price instability and protect investment.
The petrol marketers spoke against the backdrop of recent reduction in price of premium motor spirit (PMS) otherwise known as petrol by the Dangote Refinery and the Nigerian National Petroleum Company Limited (NNPCL).
Following the announcement of price cut by the Dangote Refinery by N65 at the ex-depot price, the retail price at filling stations affiliated to Dangote dropped from N925-N930 to N860.
No sooner after, the NNPCL also reduced its price at its retail stations as the price war deepened between the two dominant players.
But the PETROAN in a statement by its National Public Relations Officer, Dr Joseph Obele, 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,” he said.
He said the recent price drop resulted in massive losses running into billions of naira.
The PETROAN said, “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.
“Moreover, the threat of price fluctuations is affecting the business boom of the sector, which will definitely lead to retrenchment. This will have far-reaching consequences, including job losses and economic instability.
“To address these challenges, PETROAN proposed that regulatory authorities establish mechanisms to encourage price stability for at least six months. This approach will help reduce the uncertainty and risk associated with investments in the sector, ultimately promoting economic development and protecting the interests of consumers and Nigerians.”
Obele emphasised the need for multiple supply sources, including the Dangote Refinery, NNPC refineries, modular refineries, and imports.
The association stated that a diverse supply base would allow competition between local and imported petroleum products, ensuring fair pricing and shielding the market from exploitation.
