FCCPC warns petrol marketers over slow price cuts despite falling crude oil prices
By Aboki Forex —
The Federal Competition and Consumer Protection Commission (FCCPC) has issued a warning to refiners, marketers, depot operators, and retailers over the slow reduction of petrol prices. This comes despite a sharp drop in global crude oil prices.
In a statement on Sunday, the FCCPC's Director of Corporate Affairs, Ondaje Ijagwu, said businesses that exploit consumers could face sanctions. The Commission said its surveillance of the downstream petroleum market shows that recent price cuts at the gantry and retail levels have not matched the significant fall in crude oil prices internationally.
What the FCCPC is saying
The FCCPC noted that petroleum prices in Nigeria often rise quickly when global crude prices increase. But consumers have not seen similar benefits from the recent price decline. The Executive Vice Chairman of the FCCPC, Tunji Bello, stressed that while the Commission does not regulate petroleum prices in Nigeria's deregulated downstream sector, it is responsible for ensuring fair competition and protecting consumers.
“To be clear, the Commission does not regulate or approve petroleum prices in a deregulated downstream market,” Bello said. “Our responsibility under the Federal Competition and Consumer Protection Act, 2018, is to promote competitive markets, prevent anti-competitive conduct, and protect consumers from unfair, deceptive and exploitative business practices.”
“We are concerned that while dealers often respond swiftly by hiking pump prices whenever crude prices rise, it is curious that it is taking forever for consumers to benefit significantly when crude prices fall. Competitive markets must work fairly in both directions,” he added.
More insights
The Commission said global crude oil prices have declined sharply following the ceasefire between the United States and Iran and the reopening of the Strait of Hormuz about two weeks ago. According to the FCCPC, crude oil climbed to about $120 per barrel in April during heightened geopolitical tensions in the Middle East. It has since fallen to around $73 per barrel, returning to lower levels.