PETROAN Advocates for Reinstatement of Petrol Import Licences to Enhance Market Competition
The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) has issued a strong appeal to the Federal Government, urging the reinstatement of petrol import licences. This move is aimed at increasing competition within the downstream sector, which PETROAN argues is essential for stabilising fuel prices and ensuring energy security across the nation.
World Bank Supports Call for Increased Competition
In a recent development, the World Bank has endorsed similar recommendations, cautioning that restricted competition and supply constraints are primary drivers behind the escalating fuel prices in Nigeria. PETROAN references these concerns, highlighting the risk of higher inflation if market monopolies persist.
Dr. Billy Gillis-Harry, National President of PETROAN, emphasised that the recent surge in petroleum product prices could have been mitigated if government-owned refineries were fully operational or properly privatised. He stated, "The recent outrageous price of petroleum products would not have occurred if government-owned refineries were fully functional or properly privatised."
Dual-Track Approach for Sustainable Fuel Supply
PETROAN proposes a dual-track strategy that combines supporting local refineries with reinstating import licences. This approach seeks to ensure a steady and affordable fuel supply for all Nigerians. The association advocates for the full privatisation or commercial restructuring of government-owned refineries in Port Harcourt, Warri, and Kaduna, alongside the immediate commencement of production at the Port Harcourt refinery to ease domestic supply bottlenecks.
Joseph Obele, National Public Relations Officer for PETROAN, explained in a signed statement that reopening imports would allow multiple supply sources, thereby reducing price pressures. He drew a parallel with Nigeria's telecoms sector, where the entry of companies like MTN and Airtel led to improved services and more affordable pricing over time, illustrating that more players in the market typically yield better outcomes.
Addressing Monopolies and Ensuring Consumer Protection
PETROAN warns that relying on a limited number of suppliers in a sensitive market like fuel creates opportunities for price spikes and inefficiencies. By reinstating import licences, the association believes the market can diversify supply, reduce monopoly risks, and ultimately protect consumers from unfair pricing practices.
The call for action comes shortly after the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) announced the suspension of fuel imports, citing improved local refining capacity. However, PETROAN remains unconvinced that this is the optimal strategy at present, stressing that competition remains the most reliable method to keep prices in check.
In its recommendations, PETROAN outlined key steps for the Federal Government, NMDPRA, and the Nigerian National Petroleum Company Limited: immediate reinstatement of petrol import licences to encourage multiple supply sources and deepen competition; full privatisation or commercial restructuring of government-owned refineries for efficiency and transparency; and the start of production activities at the Port Harcourt refinery.
PETROAN clarifies that this initiative is not intended to undermine local investments, such as the Dangote refinery, but rather to support market dynamics while domestic refining capacity continues to develop. The association's message is clear: a more open and competitive fuel market is urgently needed to safeguard Nigeria's energy future.
