President Muhammadu Buhari has approved the reduction in the pump price of Premium Motor Spirit (PMS) from N145 per litre to about N125
The slash in the price of PMS is coming on the heels of a drop in the international crude oil price from $60 to $30, causing fear of a possible economic crisis.
The approval followed a presentation by Minister of State petroleum resources Mr Timipre Sylva to the Federal Executive Council (FEC), today.
The Minister , who briefed FEC on the need to reduce the pump price following the global fall in oil price ,added that already he had met with members of the organised labour in the oil and gas sector before proceeding to make the formal announcement for the price adjustment.
The organized labour, he said was happy with the reduction in petroleum pump price.
The Minister informed that the new price regime takes effect immediately, adding that the Nigerian National Petroleum Corporation(NNPC) and Petroleum Products Pricing Regulatory Agency (PPPRA) will take care of the implementation.
“The drop in crude oil prices has lowered the expected open market price of imported petrol below the official pump price of N145 per liter.
“Therefore, Mr. President has approved that Nigerians should benefit from the reduction in the price of PMS which is a direct effect of the crash in global crude oil prices.
“In view of this situation, based on the price modulation template approved in 2015, the Federal Government is directing the Nigerian National Petroleum Corporation (NNPC), to reduce the Ex-Coastal and Ex-Depot prices of PMS to reflect current market realities.
“Also, the PPPRA shall subsequently issue a monthly guide to NNPC and marketers on the appropriate pricing regime.
“The agency is further directed to modulate pricing in accordance with prevailing market dynamics and respond appropriately to any further oil market development.
“It is believed that this measure will have a salutary effect on the economy, provide relief to Nigerians and would provide a framework for a sustainable supply of PMS to our country.
“The Ministry of Petroleum Resources will continue to encourage the use of compressed natural gas to complement PMS utilization as a transport fuel,” a statement by the Minister read.