Brent crude falls below $90 as FCCPC warns marketers to cut petrol prices

Global crude oil prices have dropped below $90 per barrel after US President Donald Trump said the war involving Iran was effectively over. The Federal Competition and Consumer Protection Commission has now warned refiners and marketers that high pump prices can no longer be justified if crude costs keep falling.

Crude prices slide

Brent crude, the international benchmark, fell nearly 3% to $89.66 per barrel on Tuesday morning, November 11. The drop came a day after prices shed almost 6% as investors responded to signs that the Middle East conflict could be winding down.

Trump also played down the likelihood of further military strikes against Iran, easing concerns about prolonged disruptions to global oil supplies. Brent crude futures had climbed to around $115 per barrel in September before sliding below $90 this week.

Pump prices stay high

Petrol prices across major Nigerian cities have not moved. Motorists in Abuja are paying between N1,405 and N1,420 per litre, while prices in Lagos range from N1,325 to N1,370 per litre.

Those figures are significantly higher than the N839 per litre in Lagos and N925 per litre in Abuja recorded on February 27, the day before the conflict involving the United States, Israel and Iran broke out.

Petroleum marketers have largely blamed the spike in domestic fuel prices over the past eight months on crude price volatility and disruptions to shipping through the Strait of Hormuz, a waterway that handles at least 25% of global oil traffic.

FCCPC warning

FCCPC Executive Vice Chairman and Chief Executive Officer Tunji Bello spoke in Abuja on public concern over fuel prices that have remained stubbornly high even as global crude costs moderate.

Bello said that if the decline in crude prices holds, marketers and refiners will have no basis for keeping pump prices elevated. "If the decline in crude prices is sustained, there is no justification for refiners and marketers to continue to keep petrol and diesel prices relatively high. We expect easing in wholesale petrol costs and for the resulting savings to reach consumers at the pump without undue delay," he said.

He added that the FCCPC would work with the Nigerian Midstream and Downstream Petroleum Regulatory Authority and other relevant agencies to monitor wholesale and retail pricing.

LPG prices rise

Liquefied petroleum gas prices have increased by as much as N75 per kilogram across five suppliers in two days as international crude oil prices climbed amid renewed concerns over global energy supply disruptions.

Navgas recorded the largest increase, raising its LPG price from N1,175 per kilogram on October 20 to N1,250 on October 22. 11Plc and Nipco also raised their prices, moving from N1,180 to N1,225 per kilogram.

For Nigerian consumers and businesses, the key test is whether the fall in Brent crude is sustained long enough to force refiners and marketers to cut pump prices. The FCCPC says savings must reach motorists without undue delay.