Amid the persistent fluctuations in the Naira-Dollar exchange rate, oil marketers have issued a warning that the cost of petrol could surge to as high as N720 per litre in the near future if the dollar continues trading at its current levels. The possible price hike has been attributed to the scarcity of foreign exchange for petrol importation, causing dealers to put import plans on hold.
Oil dealers have expressed concern that the Central Bank of Nigeria’s (CBN) Importers and Exporters official window for foreign exchange, which offers a lower exchange rate, remains illiquid and unable to meet the demands of importers. The shortage of forex has led to the suspension of petrol importation by dealers who are struggling to secure the necessary funds.
Recent observations have revealed queues resurfacing in parts of Lagos and Abuja, indicating potential fuel scarcity. The Senior officials of major oil dealers have indicated that unless there is a significant improvement in the Naira’s value against the dollar, a petrol price hike is inevitable in the coming weeks.
Leaders of various oil marketers’ associations, including the Major Oil Marketers Association of Nigeria, Independent Petroleum Marketers Association of Nigeria, and Petroleum Products Retail Outlets Owners Association of Nigeria, have called for federal government intervention to address the crisis. The price of petrol is now heavily influenced by forex fluctuations, and a hike is expected as the Naira’s value against the dollar declines.
Chief Chinedu Ukadike, the national public relations officer of IPMAN, highlighted that the demand and supply of forex is a critical factor in determining petrol prices. He emphasized that the surge in the dollar’s value directly impacts the cost of petroleum products, and a higher exchange rate could result in petrol being sold for N750 per litre.
Oil marketers continue to source dollars from the parallel market due to the illiquidity of the CBN’s official forex window. As the Naira struggles against the dollar, Nigerians may need to prepare for the possibility of increased petrol prices in the range of N680 to N720 per litre, and potentially even higher if the exchange rate exceeds N1,000. The situation underscores the broader economic challenges facing Nigeria and the potential impact on daily life for citizens.
