In a statement signed by Timipre Sylva, the minister of state for petroleum resources, the federal government said Petroleum Products Pricing Regulatory Agency (PPPRA) should modulate pricing in accordance with prevailing market dynamics.
TheCable had earlier reported that the federal executive council deliberated on reducing the pump price of petrol at its meeting in Aso Rock.
“The drop in crude oil prices has lowered the expected open market price of imported petrol price below the official pump price of N145 per litre,” the statement read.
“Therefore Mr President has approved that Nigerians should benefit from the reduction in the price of PMS which is a direct effect of the crash in global crude oil prices.
“In view of this situation, based on the price modulation template approved in 2015, the federal government is directing the Nigerian National Petroleum Corporation (NNPC), to reduce the ex-coastal and ex-depot prices of PMS to reflect current market realities.
“Also, the PPPRA shall subsequently issue a monthly guide to NNPC and marketers on the appropriate pricing regime.
“The agency is further directed to modulate pricing in accordance with prevailing market dynamics and respond appropriately to any further oil market development.”
The federal government said the measure will provide relief to Nigerians and provide a framework for a sustainable supply of petrol.
According to data published by the Petroleum Products Pricing Regulatory Agency (PPPRA), the landing cost of petrol was N64.32 per litre as of Monday, March 16 and the expected open market price was N83.69.
Crude oil price dropped to $26, its lowest point in 18 years on Wednesday.