The Minister of State for Petroleum Resources, Ibe Kachikwu, yesterday stated that based on the competition inherent in the Premium Motor Spirit (PMS) price modulation, the price of petrol is likely to fall in the nearest future.
He said the price of diesel, which is now 40 per cent down amid surplus supply, was enough evidence that petrol prices will also crash. Petrol currently sells for N145 per litre.
Presenting his scorecard in his two years in office in a podcast released to reporters in Abuja, Kachikwu said that “once Nigerians throw their trading skill in it, once competition thrives, the prices will continue to tumble.
“My guess is that you will see the prices tumble in the next four, five to six months. The market will be more stable and definitely, the prices will be lower than what we see today.”
Kachikwu said, “I know that a lot of you watched as we moved price from N86.50 to N145, and you were screaming where were we heading?”
He said the government had no money from crude oil following the reduction in production as the militants were on the rampage.
The minister said, “The reality was that we didn’t have the barrel to throw at it; we didn’t have the refineries. The Federal Government was bleeding. The production today is about 1.4 because the militants’ attack had taken away about 800,000 barrels per day. Once you do not have the barrel, the foreign exchange does not come in.
“So foreign exchange was depleting and the question was what did we do with the foreign exchange we had.
“And the President made the right choice to leave what we have intact so that we do not run into a state of bankruptcy. The only option we had was to create a liberalised environment so that people can bring in their products, source their money from secondary markets, charge the right price, which they would not do unless the price was high. Fellow Nigerians, we were left with no option than what we did.”