IPMAN Says Fuel Price Will Keep Rising As Naira Depreciates Against Dollar

Ilesanmi AdekanbiAugust 10, 2023

1 minute read

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The Independent Petroleum Marketers Association of Nigeria (IPMAN) has warned that the pump price of fuel in the country will continue to increase as the naira depreciates against the dollar.

The IPMAN National President, Chinedu Okoronkwo, said that since the government removed the subsidy on petrol, the market forces and the exchange rate are the main factors that determine the fuel price.

Okoronkwo spoke with SaharaReporters on Thursday, following speculations that the pump price of petrol could hit N1,000 by December. He said he could not confirm the exact amount, but he admitted that the fuel price would keep rising as long as the dollar remains high in the foreign exchange market.

He said that the exchange rate is around N890/$1 now and that marketers buy the product in dollars. On Wednesday, the naira dropped further to N782.38/$1 at the official market and 910/$1 at the parallel market.

The Nigerian National Petroleum Company Limited (NNPCL), which is the country’s major oil marketer, announced in July that the pump price of petrol had increased to at least N617 per litre.

Okoronkwo said that Nigerians need to look for an alternative to petrol, such as Compressed Natural Gas (CNG), which is cheaper, cleaner and more environmentally friendly. He said that IPMAN members use CNG and that it is the best option for Nigerians.

“CNG offers a 30% saving over diesel (in fuel costs alone). When incorporating the full lifecycle savings of operating gas generators instead of diesel generators, the saving is up to 100% of total energy costs. Moreover, the cost of gas is stable, whereas the diesel price fluctuates regularly.”

He also said that CNG reduces greenhouse gas emissions by 70% compared to petrol or diesel. He added that CNG is safer than other types of fossil fuel because it is lighter than air and disperses quickly when released. He said that CNG can be used for generators as well as vehicles.

“It is lighter than air so that if there is any escape, it will combust like Liquified Natural Gas (LNG), Butane and Prothane. When CNG leaks, it will evaporate into the air.”

He urged Nigerians to embrace CNG as a solution to fuel price hikes and to reduce the pressure on the naira.