The Federal Competition and Consumer Protection Commission has expressed concern over the slow pace of reductions in petrol prices across Nigeria despite a significant decline in global crude oil prices, warning that consumers may not be getting the full benefits of market developments.
According to the commission, preliminary findings from its ongoing monitoring of the downstream petroleum sector indicate that refiners, depot operators, marketers and filling station owners have only made slight adjustments to fuel prices, even as international crude oil prices have fallen sharply in recent months.
The Punch reported that in a statement issued on Sunday by the FCCPC’s Director of Corporate Affairs, Ondaje Ijagwu, the agency said its assessment of current gantry and retail fuel prices suggested that the drop in crude oil costs had not translated into meaningful relief for consumers.
The statement read, “The Federal Competition and Consumer Protection Commission has expressed concern over findings from an ongoing surveillance of the downstream petroleum market suggesting undue exploitation of consumers.
“A review of the gantry prices of local refiners, marketers, depot operators and retail outlet operators revealed token reductions in prices that are not commensurate with the steep fall in crude prices in the global market.”
The Executive Vice Chairman and Chief Executive Officer of the FCCPC, Tunji Bello, said the commission was troubled by what appeared to be an uneven reaction by operators to fluctuations in crude oil prices.
He observed that fuel marketers often respond quickly when crude prices rise by increasing pump prices, but are much slower to lower prices when international oil costs decline.
Bello said, “To be clear, the Commission does not regulate or approve petroleum prices in a deregulated downstream market. 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.”
The FCCPC’s intervention follows a sharp correction in global oil prices after a ceasefire agreement between the United States and Iran, alongside the reopening of the Strait of Hormuz, helped ease fears over supply disruptions.
Last week, reports indicated that crude oil prices had dropped to around $73 per barrel, their lowest level since the outbreak of tensions between the US and Iran in February.
This represents a steep decline from the roughly $120 per barrel reached in April when concerns over the Middle East crisis pushed prices higher.
The earlier increase in crude prices triggered immediate hikes in domestic fuel costs, with petrol selling between N1,350 and N1,500 per litre in many parts of the country, while diesel prices approached N2,000 per litre.
By comparison, petrol sold for between N800 and N900 per litre in February.
Despite the recent decline in crude oil prices, petrol continues to retail at about N1,200 per litre on average nationwide.
The FCCPC also noted that some local refiners are currently offering gantry prices ranging from N1,025 to N1,075 per litre.
While acknowledging that several factors influence domestic fuel pricing, including exchange rate movements, logistics, financing, refining and distribution costs—the commission argued that competitive market conditions should ordinarily result in more noticeable reductions at the pump.
Bello said, “Market liberalisation does not diminish businesses’ obligations to compete fairly or consumers’ right to fair treatment. Where credible evidence indicates conduct that undermines competition, exploits consumers or otherwise contravenes the Federal Competition and Consumer Protection Act, the Commission will investigate and take appropriate enforcement action.”
He encouraged members of the public to report suspected cases of price manipulation, anti-competitive practices and other forms of unfair conduct through the commission’s established complaint channels.
The commission’s position is expected to fuel fresh debate over the effectiveness of deregulation in Nigeria’s petroleum sector, particularly as consumers continue to question why lower global crude prices have not resulted in corresponding reductions in fuel costs.
Since the removal of fuel subsidy and the deregulation of the downstream market, domestic fuel prices have largely been influenced by international crude oil trends and foreign exchange movements.
However, consumer advocacy groups have repeatedly accused marketers of reacting swiftly to rising costs while delaying price cuts when market conditions improve.
The FCCPC said its latest warning could signal closer scrutiny of pricing practices in the sector as pressure grows on industry operators to ensure consumers benefit from lower crude oil prices.
