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The Chief Executive of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Farouk Ahmed, has disclosed that the country’s daily petrol consumption is hovering around 45 million and 50 million litres, saying demand has increased as the yuletide approaches.
Ahmed stated this in Lagos at the ongoing OTL Africa Downstream Energy Week, refuting claims that petrol consumption dropped to 4.5 million litres following the removal of subsidies by President Bola Tinubu.
According to Ahmed, the consumption figures may drop after the yuletide when there would be less demand for petrol because of the high cost.
“The current volume that goes out in the market is ranging between 45 and 50 million litres, including the buffer that we have; but currently it’s ranging between 45 and 50 million litres per day. We see that a lot of activity is going on now because it is normally a high demand period in the fourth quarter leading to the yuletide but after that, we can possibly see the consumption go down just because of the prices,“ he said.
He opined that the new price would help in reducing fuel smuggling across the borders.
“Another thing is we are hoping that this price adjustment or liberalisation of the industry will now discourage cross-border (smuggling) because there will be less incentive to go cross-border, and that means that the product will remain within the country. We can see now the level between real supply and actual demand in the market,” he explained.
According to Ahmed, the NMDPRA no longer dictates the price because the market is fully liberalised following its deregulation.
“Our own is to provide a free market for all players. We are overseeing the market generally to ensure that all the players conform to the regulations as far as enshrined in the Petroleum Industry Act.
“So, the reason you see prices moving is because the market is basically free to move. And if you recall, even the international market for both gasoline and crude oil, which drive the product market has been very volatile because of the activities in the Middle East. So, generally speaking, the market is free to demand and supply,” he stated.
