Marketers have explained that selling diesel to Nigerians at a price below N1,000 is not possible for now, despite the announcement of a price crash by the ?angote Refinery, which offered them the opportunity to purchase at N940 per litre.
?The marketers explained that after purchasing products, they must take into consideration taxes, distribution costs, and regulatory hurdles in order to break-even.
?Recall that ?angote Petroleum Refinery, on Tuesday, announced a further reduction in the prices of diesel and aviation fuel to N940/litre and N980/litre respectively.
The price change of N940 applies to customers buying five million litres and above from the refinery, while the price of N970 is for customers buying one million litres and above, the firm stated, in a statement issued by its spokesperson, Anthony Chiejina.
?He explained that the new price aligned with the companys commitment to cushion the effect of the economic hardship in the country.
?The reasons behind the slow trickle-down effect are unclear. Some speculate that retailers are waiting to exhaust their existing stock bought at higher prices before offering the discounted rate. Others worry about potential supply-chain issues, or hidden costs, which might negate the announced price cut.
?The impact of high diesel prices goes beyond businesses. Households that rely on generators for back-up power during outages are feeling the strain.
?When asked to explain why marketers were still selling the commodity at between N1,350/litre and N1,450/litre depending on the area of purchase, the Independent Petroleum Marketers Association of Nigeria, (IPMAN), said it was because many dealers were still having the old and stock which they bought at N1,225/litre.
According to IPMAN’s National President, Abubakar Maigandi, ?The price reduction by ?angote Refinery will not reflect at the pumps immediately, because he started selling at the rate of N1,225/litre. Many marketers bought at that price and are still selling that stock.
He added, So, there is no way they can be able to reduce the price to below their cost price. But with time, the price of the product at the filling stations will reduce and normalise”.
