The Independent Petroleum Marketers Association of Nigeria has explained that the eventual renewal of the naira-for-crude deal between the Nigerian government, the Dangote Refinery and other refiners could not crash the price of Premium Motor Spirit because of the forces of demand and supply and depreciation in the foreign exchange rate.

The spokesperson of IPMAN, Chinedu Ukadike, disclosed this to newsmen in an interview on Tuesday.

Ukadike was commenting on why Nigerians did not see a drastic fuel price crash in the local market despite the downturn in global crude oil prices, which stood at $65 per barrel and $61 for Brent and WTI crude blends, respectively, on Tuesday morning, according to oilprice.com.

Global crude prices had dropped from around $67 before the emergence of United States of America President Donald Trump’s administration’s tariff war.

In the last few days, Trump and China had engaged in tit-for-tat over tariffs impacting global trade, including crude oil.

Similarly, the recent agreement on supply cuts by the Organisation of Petroleum Exporting Countries, OPEC+, had also triggered the downward slide of crude oil prices.

However, since Trump announced a global tariff pause except for China, there has been a noticeable respite in global crude prices.

Meanwhile, Nigerians have lamented that they are yet to feel the impact of the global crude price drop on local prices.

A resident of Abuja, Nurudeen Abdullahi, said that with the continuation of naira-for-crude and the price of crude in the international market, he expects local petrol to be no more than N850 per litre.

“To be fair with you, local petrol prices should be around N850 per litre or less following the current benchmark of crude oil prices, which stood around $65 per barrel, down from $72,” he said.

Another Nigerian, Evelyn Adebayo, expressed a similar view over expectations of the crash of local fuel prices.

“I believe refiners and marketers are not fair to Nigerians. If it were petrol price hike, they would have implemented it without hesitation.

“But I am surprised that local petrol prices did not drop in a commensurate level as crude prices in the international market,” she stated.

Dangote Refinery had announced a N10 reduction in its ex-depot price of petrol.

Its decision to reduce ex-depot petrol prices follows the commitment to continue the Naira-for-crude by the Nigerian government implementation committee.

Reacting, Ukadike exonerated marketers, insisting that the price of local petrol did not drop as expected because of forces of demand and supply.

He added that Nigeria’s foreign exchange rate, which stood at N1,604.48 per dollar at the official market as of Tuesday, may also be the reason local fuel prices did not crash.

“The forces of demand and supply in the downstream sector, and the cost of foreign exchange also determine the price of crude and its by-product, fuel.

“The current price of petrol is competitive and fair enough for Nigerians owing to the two factors of forces of demand and supply and FX rate,” he said.

Nigerians currently buy petrol for between N940 and N975 per litre in Abuja.