Consumers in Abuja are paying between N1,405 and N1,420 for a single litre of petrol. In Lagos, it's N1,325 to N1,370. On February 27, a day before the conflict involving the United States, Israel and Iran broke out, the same litre sold for between N839 and N925 in those two cities. That's the gap ordinary Nigerians have been left to absorb, and the Federal Competition and Consumer Protection Commission (FCCPC) has now decided to say something about it.
Who Has the Power
The FCCPC, a government regulator, issued a warning to petroleum refiners and marketers: don't keep petrol and diesel prices high now that crude oil is getting cheaper. Tunji Bello, the Commission's Executive Vice Chairman and Chief Executive Officer, delivered the message in a statement signed by Ondaje Ijagwu, Director of Corporate Affairs, after public enquiries over the stubbornly high prices.
Notice the shape of it. The people who set the prices are the refiners and marketers. The people who police them are a commission that says it is "closely monitoring developments." The people who pay are everyone else. Monitoring isn't a price cut.
Who Gets Crushed
Brent crude futures have fallen from a peak of $115 per barrel in September, about two months ago, to below $90 this week. Marketers have spent the past eight months pointing to volatility in international crude prices following the US-Iran conflict and the blockade of the Strait of Hormuz, a waterway that accounts for at least 25 per cent of global oil traffic. When crude climbed, pump prices climbed with it. Now crude is sliding, and the pump prices haven't followed.
The cost lands on transportation, household spending, and the operating expenses of businesses, particularly manufacturers and small and medium-sized enterprises. The people with the least cushion, the market trader and the commuter and the small shop owner, carry the weight. The statement itself concedes the point: "We are aware of the difficulties high pump prices have caused Nigerians for some time now," Bello said.
For some time now. Eight months of it.
What They're Calling "Order"
The Commission's remedy is conditional and open-ended. "If the decline in crude prices is sustained, there is no justification for refiners and marketers to continue to keep petrol and diesel prices relatively high," Bello said. "We expect easing in wholesale petrol costs and for the resulting savings to reach consumers at the pump without undue delay."
Read the hedges. If the decline is sustained. We expect. Without undue delay. Nobody in the statement names a deadline, a price ceiling, or a penalty. The FCCPC says it will work with the Nigerian Midstream and Downstream Petroleum Regulatory Authority and other government agencies to track wholesale and retail petrol prices, and it promises to intervene "where there is evidence of anti-competitive conduct or unfair practices that prevent consumers from benefiting from lower costs." Bello added: "we will take appropriate action within our mandate."
Within our mandate. A regulator tracking prices alongside other regulators, waiting for evidence, while the meter keeps running at the pump. That's the whole arrangement: one set of officials watching another set of sellers, and the public told to be patient.
The Reform Trap
The source reports no mutual aid effort, no community fuel-buying circle, no organized pushback from the people paying these prices. What it reports is a regulatory assurance and a market that moves on its own schedule. The power to lower the price sits with the sellers. The power to ask them nicely sits with the commission. The power to simply pay more sits with everyone else.
Crude has dropped. The filling stations haven't. Let the people at the pumps draw their own conclusions.
- fccpc
- petrol prices
- crude oil
- tunji bello
- consumer protection
- brent crude
- strait of hormuz