The Nigerian National Petroleum Company Limited (NNPCL) has assured Nigerians that there will be a reduction in the pump price of Premium Motor Spirit (PMS), popularly called petrol, in the country.

The Star had reported that the NNPCL, on Wednesday, May 31, adjusted petrol pump price to N488 in Lagos and over N500 in other states, the development which caused panic in the country.

Speaking in an interview with Arise TV on Thursday, June 1, the Group Chief Executive Officer of NNPCL, Mele Kyari, said the removal of subsidy on petrol would allow new entrants into the oil market.

Kyari stated that the entry would eradicate monopoly, adding that competition in the market would lead to a reduction in the price of petrol across Nigeria.

The NNPCL boss said: “The beauty of subsidy removal is that there will be new entrants because oil marketing companies’ reluctance to come into the market all along is the very fact of the subsidy regime that is in place.

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“And that subsidy regime doesn’t have a guarantee of repayment back to those who provide the product at subsidise price and now that the market is being regulated, oil marketing companies can actually import product or even if it is produced locally, they can buy and take it into the market and sell it at its retail price.

“Therefore, you will see competition, even with NNPCL. And by the way, by law, NNPCL cannot do more than 30 per cent of the market going forward. As soon as the market stabilises, oil marketing companies are able to come in.

“Competition will definitely come in and the market will regulate the prices itself. Therefore, this is just an instantaneous price and within a week or two, you will continue to see different prices because of different approaches from major players.

“Companies have different approaches to it and competition will guide that. Ultimately, you will see changes downwards and it is very likely because efficiency will come in.

“As soon as competition comes in, people will become more efficient in their depots, in managing their trucks, and in managing their fuel stations so that people can come to their stations.

“It is showing already; right now, you will see motorists going to stations where they can have price differences. So this will regulate the market and on its own, the price will come down naturally and I don’t see any doubt about this,” Kyari stressed.

The Star