Financial Energy Review
by Our Reporter…………..
Pressure has continued to mount on the dissolution of Petroleum Products Pricing and Regulation Agency (PPPRA) as the Manufacturer Association of Nigeria (MAN) has described the Petroleum Products Pricing and Regulation Agency (PPPRA) as an aberration considering the role the agency has set to play in the current government so called deregulation regime of the downstream sector.
PPPRA has over the weekend came out to say that it’s June 4th, 2020, published Regulation does NOT confer on marketers the power to fix prices for the product as they deem fit, but rather guiding prices would be advised by the PPPRA according to market realities.
Adding that the Agency shall monitor market trends and advise the NNPC and Oil Marketing Companies on the monthly market-based guiding price, which shall include the indicative retail price at which the product shall be sold across the country.
But MAN, Director General (DG) Mr. Chuma Oruche told Financial Energy Review that PPPRA should be scrapped and the power of determining prices of petroleum products transferred to Federal Competition and Consumer Protection Commission (FCCPC).
This is because FCCPC will ensure that customers’ interest are priority in the business value chain of the petroleum downstream as well as ensuring that consumers’ protection is core, not ancillary objective of business of this sector.
According to the law establishing FCCPC, it’s vision is for the Nigerian marketplace to be a leading model of dynamism, customer satisfaction and responsiveness to consumers.
Therefore the DG of MAN said that if there is going to be any form of deregulation it should be done Completely. “So that neither PPPRA should fix prices nor importers fixing the price of the petroleum products” he said.
However, he pointed out that the Marketers should not be allowed to form a monopoly and determining the price of petroleum products at the end of the day. “I think that is the fear of the government knowing the importance of PMS in the live of every Nigerian) he said.
National Association of Chambers of Commerce, Mines and Agriculture (NACCIMA) also raised this concern when they wrote to FCCPC recently noting that despite the review of PMS/Petrol price, the prices of the other imported petroleum products, particularly AGO/Diesel, have remained unaffected by the developments in the international oil market.
NACCIMA said that AGO/Diesel has continued to retail at a pump price as high as N226.50 in several filling stations across the country. “Which is apparently at odds with the market dynamics that should determine pricing at the present time,” NACCIMA said.
They pointed out that in Nigeria, AGO/Diesel is a major cost component for the manufacturers and household consumers.
However, MAN insisted that FCCPC is the one that has the mandate to protect consumers not PPPRA. “I think PPPRA should be dissolved, though we are members of PPPRA. The regulating of prices of petroleum products should go to the FCCPC” Oruche said.
According to a source from Depot and Petroleum Products Marketers Association of Nigeria ( DAPPMA), PPPRA should not be allowed to be fixing petroleum products if federal government has sincerely come out to say that the downstream sector has been fully deregulated. According to the source this will be like giving or releasing a goat to someone in Lagos and at the same time holding the rope of the goat in Abuja.
