Bello Addresses Slow Reduction in Fuel Prices and Consumer Exploitation
James Emejo from Abuja reports that Tanji Bello, the Executive Vice-Chairman and Chief Executive of the Federal Competition and Consumer Protection Commission (FCCPC), has issued a stern warning to downstream oil sector operators. He urged them to avoid exploiting consumers by failing to adjust retail fuel prices in line with decreases in global oil prices.
Bello’s comments come as the FCCPC continues to closely monitor the downstream oil market. Their findings indicate that the recent reductions in gantry prices implemented by local refiners, marketers, warehouse operators, and retail store operators have been minimal. He pointed out that current global crude oil prices are significantly lower than levels that would typically warrant such high retail prices.
According to FCCPC spokesperson Ondaje Ijagwu, while the commission does not regulate or approve oil prices in Nigeria’s deregulated downstream markets, it remains vigilant. The FCCPC is prepared to investigate and take action against operators who engage in anti-competitive, deceptive, or exploitative practices that violate the Federal Competition and Consumer Protection Act of 2018.
Bello clarified that the FCCPC’s role under the Federal Competition and Consumer Protection Act is focused on fostering competitive markets, preventing anti-competitive behavior, and protecting consumers from unfair practices. He stated that there is a notable imbalance in how quickly dealers respond to rising oil prices compared to their sluggish reactions when prices decline, emphasizing that competitive markets should operate equitably.
The FCCPC highlighted that international oil prices have dropped to approximately $73 per barrel following recent geopolitical developments, including the US-Iran ceasefire agreement and the reopening of the Strait of Hormuz. This decline marks a significant decrease from the peak price of around $120 per barrel observed in April during heightened tensions in the Gulf region.
Despite oil prices returning to levels similar to those in February, the FCCPC noted that domestic fuel prices have not followed suit. In the wake of a surge in crude oil prices, local refiners and distributors promptly raised pump prices, with petrol reaching between N1,350 and N1,500 per liter and diesel hitting around N2,000 per liter in April and May. In stark contrast, the price of petrol was between N800 and N900 per liter in February.
Currently, with the global oil price decline, the FCCPC reports that petrol averages about N1,200 per liter across Nigeria, while some local refiners list gantry prices between N1,025 and N1,075 per liter. Although Bello acknowledged various factors that affect domestic fuel pricing, including refining costs, currency fluctuations, logistics, and distribution expenses, he argued that a more competitive market could have facilitated quicker benefits for consumers from lower input costs. He emphasized that market liberalization does not exempt companies from their duty to compete fairly or diminish consumers’ rights to fair pricing.
Bello reiterated that if there is substantial evidence of practices that stifle competition, exploit consumers, or infringe upon federal competition and consumer protection laws, the FCCPC will act decisively. He also urged consumers to report any suspected anti-competitive behavior and deceptive pricing practices through the commission’s established complaint channels, promising that all credible reports will be thoroughly addressed.
