President Muhammadu Buhari on Wednesday approved an immediate reduction in the pump price of premium motor spirit (PMS), otherwise known as petrol, from N145 to N125 per litre.
The reason for the slash in price was hinged on the crash in global crude oil prices following the outbreak of coronavirus deadly disease.
The President after the announcement of the reduction also directed officials of the Nigerian National Petroleum Corporation (NNPC) to work out an appropriate price in line with market realities for AGO (diesel) and kerosene.
Buhari reduced the price after the Federal Executive Council (FEC) meeting.
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The Minister of State for Petroleum, Timipre Sylva, who gave an insight into the development after the meeting, presided over by Buhari, said: “The drop in crude oil prices has lowered the expected open market price of imported petrol below the official pump price of N145 per litre.
“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 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.
“It is believed that this measure will have a salutary effect on the economy, provide relief to Nigerians and would provide a framework for a sustainable supply of PMS to our country.
“The Ministry of Petroleum Resources will continue to encourage the use of compressed natural gas to complement PMS utilization as a transport fuel.”