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COVERNEWSLETTEROIL & GAS

Global Oil Price, Devaluation Push Diesel Price To N280/litre

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The pump price of a litre of Automotive Gas Oil, also known as diesel, has increased to N280 this month due to the recent increase in global oil prices and devaluation of naira.

A litre of diesel sold for an aveerge price of N238.82 in May and N237.19 in April, according to the diesel price watch report by the National Bureau of Statistics (NBS).

The global oil benchmark, Brent crude, which averaged $62.28 per barrel in February, is now $74.30 per barrel as of 5:40 am Nigerian time on Tuesday.

It was discovered that many filling stations in Lagos State on Monday sold the product, which is not regulated by the government, for between N270 and N280 per litre.

Mobil, Capital Oil and Gas as well as Oando filling stations, all along the Lagos-Ibadan Expressway, sold the product for N280, N279.9 and N275 per litre. The product was sold for N267.50 per litre at NNPC Retail stations.

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Diesel is mostly used by businesses as alternative sources of power for their generators when the epileptic electricity from the national grid goes off.

Last month, the Central Bank of Nigeria devalued the naira as it adopted the NAFEX exchange rate of N410.25 per dollar as its official exchange rate, days after removing the N379/$ rate from its website.

The naira fell to 502/$1 on Monday at the parallel market from 500/$1 on Friday.

“The high diesel cost is taking a huge toll on operating and production costs across sectors. It is a case of multiple jeopardy for businesses,” the Director-General, Lagos Chamber of Commerce and Industry, Dr Muda Yusuf, told PUNCH on Monday.

“There is foreign exchange market illiquidity. The cargo clearing at our seaports is a nightmare. The security situation has inflicted an elevated risk to investment,” Yusuf said.

According to him, diesel cost also has profound implications for transportation and logistics costs.

About Author

Ife Ogunfuwa is an award-winning reporter who is versed in reporting business and economy, technology, gadgets reviews, telecoms, tax, and business policy review, among others. She loves telling stories behind the numbers. She has professional certifications in business and financial reporting. You can reach her via – [email protected]

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