The Federal Government does not have the power to directly fix petrol prices under Nigeria’s current deregulated downstream petroleum market, the Minister of State for Petroleum Resources, Heineken Lokpobiri, has said.
Lokpobiri made the clarification while speaking on Channels Television’s Politics Today on Tuesday, attributing the recent rise in energy costs to developments in the international oil market, particularly the ongoing crisis in the Middle East.
He explained that crude oil and refined petroleum products are traded globally, meaning changes in international prices have a direct impact on Nigeria.
“Oil and gas is a global commodity. What is sold in New York is also what is sold here,” the minister said.
According to him, the pressure from rising energy prices is not unique to Nigeria, as consumers in the United States and Europe are also dealing with reduced purchasing power.
Lokpobiri said the government could not simply dictate a lower or higher petrol price in a deregulated market without effectively returning to a subsidy system.
Asked whether the Tinubu administration could decide to increase or reduce petrol prices, he replied, “No, we don’t,” stressing that the downstream sector was fully deregulated.
He added that even a significant increase in Nigeria’s crude oil production would not automatically translate into cheaper petrol because crude oil is traded at international market prices.
Lokpobiri also defended President Bola Tinubu’s decision to remove petrol subsidy in May 2023, arguing that the policy was introduced at a critical point for the country’s finances.
He maintained that keeping the subsidy in place could have exposed Nigeria to deeper economic difficulties, comparing the possible outcome with Venezuela.
The minister further said the removal of the subsidy had freed government funds that could be channelled into other areas of the economy.
His comments come amid renewed concerns over petrol prices, which have increased pressure on transportation costs, household budgets and the prices of goods and services. Recent reports have also linked the latest fuel-price pressures to higher international crude oil prices resulting from tensions in the Middle East.
