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Economy

FCCPC to sanction petrol price profiteers

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• We are compliant with price reduction, says IPMAN

• It’s pure business decision, says Dr. Yusuf

 

The Federal Competition and Consumer Protection Commission (FCCPC) may wield the big stick on oil marketers across the country following their reluctance to reduce petrol pump price in alignment with the falling global crude oil price.

The Commission, in a statement signed by its Director, Corporate Affairs, Ondaje Ijagwu, expressed concern over the outcome of its findings from surveillance of the downstream petroleum market suggesting undue exploitation of consumers.

The planned action, the Commission said, has become necessary after it observed that ins spite of a downward review of the gantry prices of petrol by domestic refiners, marketers, depot owners, and retail outlet operators only reflected the a negligible price reduction which are not commensurate with the steep fall in crude prices in the global market.

The FCCPC’s position may be right. This is because, following a ceasefire agreement between U.S. and Iran two weeks ago and the reopening of the Straits of Hormuz, crude oil prices have been on a steady decline, falling to $71.99 per barrel (Brent crude) and $69.23 per barrel (WTI) yesterday- a sharp drop from the peak of $120 per barrel in April, returning to the prices in the pre- US-Iran war era in February.

The global spike in crude prices led to local refiners and marketers raising pump prices swiftly across the country, with petrol price climbing to between N1,350 to N1,500 and diesel selling N2,000 as hostilities intensified in the gulf between April and May. In February, petrol averaged between N800 and N900 per litre at the retail pumps. Presently, notwithstanding the global price fall of crude oil, petrol is still sold at average of N1,200 while some local refiners fixed between N1,025 and N1,075 as their gantry prices.

The Executive Vice Chairman and Chief Executive Officer of the FCCPC, Tunji Bello, explained that while the Commission does not regulate or approve petroleum prices in a deregulated downstream market, however, it (the Commission) has a responsibility under the Federal Competition and Consumer Protection Act 2018, to promote competitive markets, prevent anti-competitive conduct and protect consumers from unfair, deceptive and exploitative business practices.

“We are concerned that while dealers often respond swiftly by hiking pump prices whenever crude prices rise, it is curious that it is taking forever for consumers to benefit significantly when crude prices fall. Competitive markets must work fairly in both directions.

 

“Though recognising that domestic prices are influenced by a range of commercial and market factors (including refining costs, foreign exchange movements, logistics, financing and distribution expenses), the Commission however expects competitive market dynamics to have eased the swift transmission of resulting cost efficiencies to consumers.

“Market liberalisation does not diminish businesses’ obligations to compete fairly or consumers’ right to fair treatment. Where credible evidence indicates conduct that undermines competition, exploits consumers or otherwise contravenes the Federal Competition and Consumer Protection Act, the Commission will investigate and take appropriate enforcement action,” Bello explained.

The National President, Independent Petroleum Marketers Association of Nigeria (IPMAN), Abubakar Maiganda, however said marketers were already complying with the price reduction. He explained that marketers are responded to the price cut by the same percentage cut in price from the refiners.

“You have to know that this price cut is in batches. So as they are reducing, we too are reducing. When Dangote Refinery reduced by N50 per litre, we reflected the same N50 reduction in our pump price; any amount of money that is reduced from the ex gantry price, that is the same amount money that we are reduce on our pump price,” Maigandi said.

He challenged the FCCPC to take a survey of IPMAN stations and verify the level of compliance of its members. “We must, the compliance is must because if you don’t comply, nobody will come and patronise your product. Nobody will see a cheaper product and go and buy it at a higher cost. Actually, all our marketers are complying. I have always insisted that we like the reduction because that reduction itself makes for more volume of petrol to be sold,” Maigandi explained.

Still, some top operators in the oil marketing segment accuse the FCCPC of double standard in the prevailing situation. Top officials of other marketing associations, when asked to comment on the Commission’s position and threats of sanction against erring marketers, said it smacks of double standard on the commission’s part to say it would sanction marketers.

The top officials, who pleaded to remain anonymous after being pressured to speak to the matter, said: “We await their sanctions. Where was the FCCPC when we were crying out that we were being demarketed by local refiners? The FCCPC didn’t see what the refiner was doing at that time as anti-competitive conduct for it to intervene but now it wants to intervene. Is that not double standards?” the official retorted.

The Chief Executive Officer, Center for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, agreed that the FCCPC may intervene irrespective of the sector being deregulated.

“Well, if there are obvious cases of corruption, for instance, or if people who have so strong market power are trying to be exploitative, the FCCPC can intervene because the competition commission has broad powers to address issues of price commotion, issues of abuse of monopoly powers, issues of abuse of market powers. That is their mandate.

“But they must establish that such situation exists before they can begin to intervene. You have many players in the downstream. So there is a framework that will allow competition to happen,” Yusuf argued.

But much as the FCCPC has the statutory power to prevent anti competition and protect consumers, Yusuf argued that it will be a difficult task to compel marketers on pricing because it is purely a business decision.

“If you have a stock and the price of that stock went up, even though you bought it at a lower price, you are going to price it at a replacement cost. That is normal business sense. If you finish selling it, at what price are you going to replace it? That is why you determine at what price you will sell it. So it is pure business sense. So it is a difficult thing to compel businesses on certain issues,” Dr. Yusuf said.

 

According to the CPPE boss, generally, prices are sticky downwards. This implies that when it’s time for price reduction, it comes very slowly and reluctantly.

“That is the general behaviour of many businesses. It will take some significant competitive pressure to bring down the price. But the flip side is that if it’s a case of increasing price, it will be instant. Yes, it will increase instantaneously. However, that is a typical business behaviour, because if they want to replenish, they are going to replace at a higher cost. So they are looking at replacement costs to determine the price.

“The business argument of many of these marketers is that they have an old stock, which they bought at a high price. Therefore, until they exhaust the old stock, they will not be able to reduce the price significantly. That it is when they now buy a new stock at a lower price, then they will sell at lower price,” he said.

Bello encouraged consumers to continue reporting suspected anti-competitive conduct, misleading pricing practices and other forms of unfair market behaviour through the Commission’s established complaint channels.

Economy

Fed govt revenue grows faster than interest payments

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The Federal Government’s revenue rose by 72 per cent to N6.2 trillion in the first half of 2026 from N3.6 trillion in the corresponding period of 2025, while interest payments increased by 38 per cent to N7.7 trillion from N5.6 trillion.

The Federal Ministry of Finance disclosed this on Sunday while responding to public commentary on the World Bank’s October 2026 Nigeria Development Update, which put federal interest payments at 124 per cent of revenue in the first half of this year.

The ministry said the growth in revenue had outpaced the increase in interest payments, reducing the interest-to-revenue ratio from 156 per cent in the first half of 2025 to 124 per cent in the corresponding period of 2026.
It added that the difference between interest payments and revenue narrowed from N2 trillion to N1.5 trillion within the period.

In a statement issued in Abuja, the ministry said the 124 per cent ratio did not present a complete picture of the government’s revenue position because some earnings were excluded from the calculation, while the interest figure covered obligations beyond the Federal Government alone.

According to the ministry, the interest payments include external loans obtained by state governments but serviced by the Federal Government.
It said comparing these obligations with federal revenue alone could overstate the ratio because the debt and revenue figures did not cover the same levels of government.

 

The ministry also said the revenue figure excluded independent income earned by government agencies and enterprises but not yet remitted to the Treasury.
It added that the timing of statutory tax payments affected the half-year figures, as some payments typically generate more revenue in the second half of the year.
The ministry cited the 2025 figures, saying the interest-to-revenue ratio stood at 156 per cent in the first half of that year but fell below 60 per cent for the full year. It also put the ratio at 97 per cent before the current administration’s reforms.
On the 2026 outlook, the ministry referred to the World Bank’s projection that Nigeria’s full-year debt service, covering both interest and principal repayments, would amount to 46 per cent of revenue.

The ministry said the full-year figure was a more appropriate measure for assessing the country’s debt-service position than a six-month comparison.
It maintained that all Federal Government borrowing was within the limits approved by the National Assembly under the 2026 Appropriation Act and the approved borrowing plan.

The statement added that the government’s borrowing complied with the Fiscal Responsibility Act 2007 and the Debt Management Office (Establishment) Act 2003.
It said the Debt Management Office regularly published information on government borrowing.

The ministry welcomed public scrutiny of government finances and urged analysts to compare revenue and debt figures covering the same levels of government and to consider the periods covered by the data.
It said the government remained open to requests for clarification on public finance figures.

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Economy

FAAC: Fed. Govt, States, LGs Share N2.428tr September Revenue

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The three tiers of government have shared N2.428 trillion revenue generated by the Federation in September 2026, according to the Federation Account Allocation Committee (FAAC).

The amount was shared at the committee’s October meeting in Abuja, with the Federal Government receiving N832.242 billion, state governments getting N799.872 billion and local government councils receiving N560.660 billion. The beneficiary states of the 13 percent derivative also received N236.049 billion as derivation revenue from mineral resources.

The Director of Press and Public Relations in the Office of the Accountant-General of the Federation (OAGF), Bawa Mokwa, disclosed this in a statement on the outcome of the meeting yesterday in Abuja.

The total distributable revenue comprised N1.672 trillion from statutory revenue and N756.587 billion from Value Added Tax (VAT).

 

According to the communiqué issued by FAAC, the Federation generated gross revenue of N3.913 trillion in September. However, N131.758 billion was deducted as the cost of collecting the revenue, while N1.352 trillion went into transfers, refunds and savings.
The figures show that the amount shared among the three tiers of government was lower than the gross revenue available for the month after the various deductions and other obligations were taken into account.

 

A breakdown of the statutory revenue showed that the Federal Government received N756.583 billion, while the state governments got N383.749 billion. The local government councils received N295.855 billion, while N236.049 billion was paid to the benefiting states as their 13 per cent derivation share of mineral revenue.

From the N756.587 billion distributable VAT revenue, the Federal Government received N75.659 billion, state governments got N416.123 billion and local government councils received N264.805 billion.

The allocation figures show that state governments and local government councils received the larger shares of the distributable VAT revenue, while the Federal Government received a smaller portion.
The communiqué also showed that gross statutory revenue rose in September, while VAT revenue declined during the period.

Gross statutory revenue stood at N3.096 trillion in September, compared with N2.850 trillion recorded in August. The increase of N246.384 billion represented a rise in revenue available from statutory sources.
In contrast, gross VAT revenue fell to N816.872 billion in September from N834.843 billion in August, representing a decline of N17.972 billion.

The difference in the performance of the two revenue sources means that the increase in statutory revenue was accompanied by a reduction in VAT receipts during the month.

FAAC attributed the changes in revenue performance to increases in some tax and petroleum-related revenue sources, alongside declines in others.

Petroleum Profit Tax, Hydrocarbon Tax, petroleum royalties, import duty, Common External Tariff (CET) levies and excise duty recorded significant increases in September.

However, Companies Income Tax (CIT), Capital Gains Tax (CGT), Stamp Duties Tax (SDT), VAT, mineral royalties, gas-flaring penalties, rental gas-flaring fees and miscellaneous oil revenue declined during the period.

 

 

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Economy

Temporary fuel price relief is not subsidy, says Dr. Yusuf

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By Oluwayanmife Lucas

Economic policy group and economist yesterday lent their support to the federal government’s decision to implement a temporary fuel price relief. They warned that this relief should not be misconstrued as return of subsidy on petroleum products, but be seen as a priority by government to protect vulnerable citizens, preserve the sustainability of public finances and maintain the integrity of ongoing economic reforms.

Besides, they warned that the commercial status of the Nigerian National Petroleum Company Limited (NNPC) Limited does not eliminate the government’s responsibility to respond to exceptional public-interest considerations.

NNPC Ltd., the group maintained, remains a government-owned commercial enterprise with a diversified portfolio of petroleum-related businesses, whose commercial mandate should ordinarily guide its operations. However, the policy group argued, temporary and clearly defined public-interest interventions can be accommodated within an appropriate governance framework.

The Group, Center for the promotion of Private Enterprise (CPPE), a policy and economic think-tank group, in a chat with The Nation yesterday, argued that the critical consideration is that such interventions must be transparent, proportionate, time-bound and financially sustainable.

The CPPE further noted that the current global energy crisis demands pragmatic policy responses, not ideological rigidity. It further argued that although economic reforms must remain sustainable, but they must also be responsive to the welfare of the people.

Therefore, it explained, Nigeria does not need a return to the “fiscally destructive” subsidy regime, but a credible framework for temporary, targeted and transparent social protection during exceptional economic shocks.

Speaking with exclusively The Trust News, the Chief Executive Officer, CPPE, Dr. Muda Yusuf, explained that economic policies are instruments for promoting citizens’ welfare; hence, they should not become rigid doctrines that prevent governments from responding to exceptional social and economic difficulties.

He noted that the current escalation in petroleum product prices is driven principally by developments in the global energy market, particularly geopolitical tensions that have pushed crude oil prices above $100 per barrel. He described this as an “external shock affecting both oil-producing and oil-importing economies; it is neither a consequence of Nigeria’s subsidy removal policy nor peculiar to the Nigerian economy.”

Dr. Yusuf warned against the misconception that the Federal Government’s recent fuel price relief initiative through the NNPC is a reversal of the petroleum subsidy removal policy. Such an interpretation, he argued, is misleading and fails to distinguish between a fundamental policy reversal and a temporary intervention in response to an extraordinary economic shock.

“Extraordinary economic circumstances sometimes require exceptional policy responses. Governments across the world have historically intervened to cushion households and businesses against severe external shocks without abandoning their underlying economic policy frameworks. The COVID-19 pandemic provided compelling evidence of this approach, even in advanced market economies.

“The intervention is substantially different in scale, design and potential fiscal implications from the previous subsidy regime. Its temporary character and limited market coverage are important distinctions,” Dr. Yusuf said.

According to him, the removal of the previous petroleum subsidy was a necessary structural reform, therefore, reinstating a broad-based consumption subsidy would recreate serious fiscal vulnerabilities and undermine the gains from economic reforms.

He explained further: “For illustration, a subsidy of ₦1,000 per litre on national consumption of 50 million litres daily would create a fiscal exposure of approximately ₦50 billion daily; ₦1.5 trillion monthly and ₦18.25 trillion annually. Such an obligation would be fiscally unsustainable, especially in an economy facing substantial infrastructure deficits, debt-service commitments and competing development priorities. However, a limited and temporary intervention should not automatically be interpreted as a deterioration in policy credibility.”

Dr. Yusuf, an economist, explained that investors are principally concerned about policy predictability, market access, commercial viability, fiscal sustainability and the protection of legitimate investments. These fundamentals, he said, need not be compromised by a narrowly targeted emergency relief measure.

In this regard, the CPPE argued that there is a need to have a critical distinction between the previous subsidy regime and the current intervention. Under the former subsidy arrangement, Dr. Yusuf said, government effectively carried a substantial fiscal burden on nationwide petrol consumption, estimated at various times at between 50 million and 80 million litres daily. This arrangement created enormous fiscal pressures, weakened public finances, crowded out development spending and contributed to macroeconomic instability.

Citing an illustrative calculation based on the volumes contained in the ministerial commentary; by contrast, he said, the current intervention covers approximately 70 million litres of NNPC fuel supply monthly, compared with estimated national petrol consumption of 50 million litres daily and an estimated national monthly consumption of 1.5 billion litres; while NNPC monthly volume under the intervention will be 70 million litres, translating to an estimated national consumption of 4.7 per cent

“Arising from these figures, an intervention covering less than five per cent of estimated national consumption cannot reasonably be equated with a nationwide subsidy regime. More importantly, the intervention does not reinstate an administered national petrol price, impose a general subsidy obligation on private operators or dismantle the market-oriented framework for petroleum product pricing.

“The appropriate questions should therefore concern the fiscal cost, transparency, duration, beneficiaries and effectiveness of the intervention, rather than an inaccurate characterisation of it as a wholesale policy reversal,” Dr. Yusuf argued.

But beyond fuel discounts, the CPPE said there is a need to addressing the wider social costs. It said that while the proposed fuel price relief is a welcome development, its limited coverage means that its aggregate impact on household welfare will also be limited.

Government, the group further highlighted, should pursue broader interventions that address the principal channels through which the energy price shock affects citizens.

In a four-point agenda, the CPPE said the government should scale up affordable mass transit, because transportation is one of the most immediate transmission channels of higher energy prices to household expenditure and business operating costs. To this end, the group said the federal and state governments should prioritise high-capacity buses, including CNG, electric and other economically viable alternatives.

Support for agricultural productivity and food supply, strengthening state and local government interventions by way of states designating discounted fuel outlets, limited emergency fuel allocations for essential services, like subsidised public transport and targeted support for vulnerable households, should be considered, as well as protecting the integrity of petroleum market reforms.

“Government should sustain market-based pricing, fair competition, transparent regulation and a trade policy framework that supports domestic refining investment. Emergency interventions should not become a pretext for arbitrary price controls or the reintroduction of opaque fiscal obligations,” Dr. Yusuf submitted.

 

 

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