Oil prices dip 17 years lower, sell at $24pb
The ravaging COVID-19 pandemic has continued to take a direct hit at the global oil market as prices further plunged to 17-year low, last week, ebbing at $24.88 per barrel.
A free fall in demand during the week witnessed Brent crude declining by 13 per cent, the lowest since 2003, making oil cheaper than any time during the global financial crisis.
The drop further lowered the expected open market price of imported petrol below the official pump price of N145 per litre, prompting the Nigerian Government to slash the price of petrol by N20.
Minister of State for Petroleum Resources, Chief Timipre Sylva, who announced the reduction in a statement, said President Buhari approved that Nigerians should benefit from the reduction in the price of PMS which is a direct effect of the crash in global crude oil prices.
“In view of this situation, based on the price modulation template approved in 2015, the Federal Government is directing the Nigerian National Petroleum Corporation (NNPC) to reduce the Ex-Coastal and Ex-Depot prices of PMS to reflect current market realities.
“Also, the Petroleum Products Pricing Regulatory Agency (PPPRA) shall subsequently issue a monthly guide to NNPC and Marketers on the appropriate pricing regime. The Agency is further directed to modulate pricing in accordance with prevailing market dynamics and respond appropriately to any further oil market development.
“It is believed that this measure will have a salutary effect on the economy, provide relief to Nigerians and will provide a framework for sustainable supply of PMS to our country. The Ministry of Petroleum Resources will continue to encourage the use of Compressed Natural Gas to complement PMS utilization as transport fuel,” he said.
Meanwhile, the Nigerian National Petroleum Corporation, NNPC, has in compliance with the directives of the Minister of State for Petroleum Resources on PMS pricing, reviewed its Ex-coastal, Ex-depot and NNPC retail pump prices accordingly.
NNPC announced in a statement that “Effective 19th March 2020, NNPC Ex-Coastal price for PMS has been reviewed downwards from N117.6/litre to N99.44/litre while Ex-Depot price is reduced from N133.28/litre to N113.28/litre.”
According to the corporation, these reductions will therefore translate to N125/litre retail pump price, adding that despite the obvious cost implication of this immediate adjustment to it, NNPC is delighted to effect this massive reduction of N20/litre for the benefit of all Nigerians.
“Accordingly, all NNPC Retail stations nationwide have been directed to change the retail pump price to N125/litre,” it said.