…Accuses marketers of exploitation
President of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) Festus Osifo, has claimed that the recurring shutdowns of Nigeria’s state-owned refineries are driven more by political motives than operational challenges.
PENGASSAN also accused petroleum marketers of exploiting Nigerians through inflated petrol prices, insisting that the current pump price of Premium Motor Spirit should range between ₦700 and N750 per litre.
Speaking at a world press conference on Nigeria’s Oil and Gas industry and state of the nation yesterday in Abuja, Osifo said the inefficiencies plaguing Nigeria’s refineries, especially the Port-Harcourt Refinery, may not be due to technical shortcomings but stem largely from political interference.
He noted that despite billions of naira totalling $2.5bn sunk into rehabilitation efforts over the years, the nation’s refineries have remained largely unproductive, with shutdowns frequently occurring under questionable circumstances.
Recall that the state-owned firm announced a temporary shutdown of the Port-Harcourt refinery for 30 days over maintenance activities. The facility is expected to be back on stream next week Tuesday.
Osifo noted that adopting this model would significantly reduce political interference, allowing the refineries to operate based on commercial principles rather than political interests.
Speaking further, the union president accused petroleum marketers of exploiting Nigerians through inflated petrol prices, insisting that the current pump price of Premium Motor Spirit should range between ₦700 and ₦750 per litre.
He criticised the disparity between falling global crude oil prices and the stagnant retail price of petrol in Nigeria. According to him, despite crude prices dropping from about $80 to $60 per barrel, petrol continues to sell at around ₦900 per litre. A litre of petrol currently sells between ₦875 to ₦905 per litre, depending on location nationwide.
“In the downstream today, in the Nigerian oil and gas industry, we have seen a trend. When the price per litre of petrol was around N900, crude oil was selling at about $80 per barrel. Today, with crude hovering between $62 and $65, there has been no commensurate reduction in the pump price”, Osifo said.
Osifo attributed the pricing inconsistency to the failure of the Nigerian Midstream and Downstream Petroleum Regulatory Authority to effectively monitor and regulate pricing under the deregulation framework. “NMDPRA should not watch the suppliers of products exploit the citizenry on the pretence of deregulation”, he said.
Explaining the pricing mechanism, Osifo stated that crude oil prices and the exchange rate account for about 80 percent of the final retail price of PMS.
Based on prevailing international pricing benchmarks, he said the cost of fuel should have adjusted downward. “There is what we call PLAT,” he said, referring to Platts’ oil price benchmark. “If you go online and check the PLAT cost per cubic metre of PMS, convert that to litres and then to our Naira, you will see that with crude at around $60 per barrel, petrol should be retailing between ₦700 and ₦750 per litre.”, he stated.
The PENGASSAN president called on NMDPRA to immediately begin publishing pricing templates to ensure transparency and to prevent arbitrary pricing under the deregulated system.
The trade union also raised the alarm that worsening insecurity in Nigeria’s oil-producing areas, especially in the waterways, is forcing multinational oil companies to divest from the country, despite newly introduced cost-saving incentives by the Federal Government.
He commended the recently signed Upstream Petroleum Operations Cost Efficiency Incentives Order (2025) by President Bola Tinubu, but failed to address the root causes of the high cost of production, which he said is most notably insecurity.
The Executive Order, signed in May, introduces performance-based tax credits up to 20 percent, for upstream companies that meet defined industry benchmarks for cost efficiency.
While PENGASSAN acknowledged the effort, Comrade Osifo insisted that without government-backed security, the real issue would remain unresolved.
