Fuel crisis: Unpredictable fuel prices threaten Nigerian businesses

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Marketers in Nigeria’s oil and gas sector have expressed concerns over the fluctuating pump prices of premium motor spirit (PMS) or petrol, warning that the trend could push several businesses out of operation if left unchecked. The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has urged the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) and the Federal Competition and Consumer Protection Commission (FCCPC) to intervene and ensure fairness in pricing.

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PETROAN President Billy Gilly-Harris described the fluctuating prices as a challenge. “The challenge we have is that we buy products at a price today, and before the close of business, the price has reduced,” he said. “We thought there should be a mechanism by which prices are analysed and ensure it doesn’t impact negatively on the industry.”

Gilly-Harris emphasised the need for stability in the market, saying, “We have been at the forefront of always implementing what stakeholders agree. We have the capacity to import our products. We also have the capacity to buy locally refined products. But we see that prices consistently shift up or down, and there is no clear business consultation on how this should be done.

He urged the NMDPRA and FCCPC to work together with stakeholders to achieve a stable market and price. “That is why we said the NMDPRA and the consumer protection agency should swing into action and be able to work together with other stakeholders so that we can be able to have a stable market and a stable price,” Gilly-Harris said.

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Stakeholders have cited relevant laws, including Section 8(1)(d) of the petroleum industry law, which mandates the NMDPRA to ensure “fair pricing and competition in the midstream and downstream petroleum operations”. Sections 120-127 of the FCCPC Act 2018 also empower the FCCPC to monitor and investigate anti-competitive conduct.

Oil and gas consultant Taiwo Ogunleye emphasised the need for a competitive market with fair and transparent conditions. “The government should ensure a competitive market where multiple market players can freely enter, compete and operate under fair and transparent conditions,” he said.

Ogunleye highlighted practices to avoid, including “price fixing, predatory pricing, discriminatory tariff practices, market allocation, monopolisation or abuse of dominance, exclusive contracts, unfair restriction in distribution and retail operation, refusals to supply or deal, discrimination in pricing, or limiting infrastructure access to competitors.” He added that these behaviours “distort market conditions, create artificial barriers for new entrants or small players, undermine transparency in the pricing process, harm consumers welfare and hinder innovation and improvement in service quality.”

Senior Partner at The Commercial and Energy Law Practice (CANDELP) and Founder of 1worq, Israel Aye, also emphasised the importance of fair competition. “Fair competition will bring low prices for consumers, higher quality products, improved services, product innovation and transparency, as well as incentivised operations in the sector,” he said.

Aye urged the government to reinforce regulatory responsibility and strengthen institutional autonomy and accountability frameworks. “If you don’t have a market that promotes fair competition, the consumers will suffer,” he concluded

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