Nigeria implements new Naira-based sales mechanism for petroleum products

In line with the directive of the Federal Executive Council (FEC), the Implementation Committee on the Sales of Crude Oil and Refined Products in Naira, led by Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, held its second review meeting on October 10, 2024.

The meeting focused on evaluating the transition to a deregulated market structure for Premium Motor Spirit (PMS) and the new purchasing model for petroleum product marketers.

One of the most significant changes introduced under the new regime allows petroleum product marketers to purchase PMS directly from local refineries.

This marks a departure from the previous arrangement in which the Nigerian National Petroleum Corporation Limited (NNPCL) acted as the sole purchaser and distributor of PMS from refineries.

This direct purchasing mechanism enables marketers to negotiate commercial terms directly with the refineries, fostering a more competitive market environment and facilitating a smoother supply chain for petroleum products.

Also, the commencement of local PMS production has equipped the market to support these direct transactions.

The transition is anticipated to enhance efficiency in product availability and stabilize market conditions for the benefit of all Nigerians.

Mr. Edun acknowledged that there are ongoing discussions and questions regarding this change in market structure.

He assured stakeholders of the Committee’s commitment to providing clarity on this development and emphasized the importance of continuous engagement with all parties involved to ensure a seamless transition process.

He added that the Implementation Committee remains focused on fostering a competitive and efficient market environment that will benefit consumers and contribute to the overall economic stability of Nigeria.

Meanwhile, Edun has emphasized the crucial role of ongoing macroeconomic reforms in shaping the nation’s economic future.

Speaking at the Nigerian Economic Summit Group (NESG) Conference held in Abuja, Edun reflected on 25 years of democracy in Nigeria and reiterated the need for continuous progress in governance and the expansion of economic opportunities.
While acknowledging the challenges faced in the agricultural sector, Edun reiterated the government’s commitment to addressing food inflation and enhancing food security.