Lagos — The Major Oil Marketers Association of Nigeria, MOMAN has called for the scrapping of Petroleum Products Pricing Regulatory Agency (PPPRA) and Petroleum Equalization Fund (PEF), since the industry is moving towards full deregularization.
Reacting to the government plan of merging both Agencies , MOMAN noted that both organisations are not necessary in a fully deregulated market, adding that all the marketers need is the ex-depot prices – the landing cost, marketers can then fix prices at the pump.
MOMAN urged marketers organizations to stop setting prices for their members, describing it as price fixing, as there is a need for healthy competition which will eventually lead to moderate prices.
MOMAN advised that the focus should be on the implications of the removal of under recovery rather than the hardship, they added that ‘Without the short term hardship Nigeria will be in deeper trouble and become like Venezuela. So for the sake our children, we have to bite the bullet for a better future’
While speaking on the current petroleum products hike, the Chairman, Major Oil Marketers Association of Nigeria, MOMAN, Tunji Oyebanji, said, prices at the pump will have to be adjusted to reflect realities of the increase of ex-depot prices by Petroleum Products Marketing Company, (PPMC).
‘However the magnitude of the increase, timing and location is a decision left to each company and consistent with global best practices, MOMAN does not dictate prices to its members as this would be anti-competition in a fully deregulated market’ he stated.
Oyebanji said that MOMAN welcomes government action in allowing the market to determine prices as they believe it will prevent the return of subsidies, while allowing operators the opportunity to recover their costs.
The MOMAN boss reiterated that, this will in the long run encourage investment and create jobs, revealing that the country is broke and can no longer afford subsidy and more also there is no provision for it in the budget.
He said with this, the incentive for smuggling will be reduced, more funds will be available to the government for investment in infrastructure, roads, health, education and power.
According to him, ‘deregulation means that prices will go up and down, it went down in April now they will go up as we are entering the European winter season as demand for refined crude goes up’
He disclosed that there are indications of more investments in local refining in Nigeria which will moderate the cost, as fierce competition will also moderate the price.
‘As you can see, not everyone is selling at the same price. So as things stand we are into full deregulation. Unfortunately this is coming at the time when most of our citizens are struggling with difficulties created within the context of the post Covid-19 economy, but we believe that Nigeria has been presented with a historic opportunity to get it right this time as a country to rebuild our economy for the benefit of all Nigerians’ he said.