The Federal Competition and Consumer Protection Commission (FCCPC) has warned operators in the downstream petroleum sector against exploiting consumers by failing to reflect the decline in global crude oil prices in petrol pump prices.
In a statement issued on Sunday, the Executive Vice Chairman and Chief Executive Officer of the Commission, Tunji Bello, said ongoing market surveillance showed that reductions in gantry prices by local refiners, marketers, depot operators and retail outlets remained marginal despite the significant drop in international crude oil prices.
Bello noted that while the downstream petroleum sector operates in a deregulated market, the commission would not hesitate to investigate and sanction operators found engaging in anti-competitive, deceptive or exploitative practices in violation of the Federal Competition and Consumer Protection Act (FCCPA), 2018.
“To be clear, the Commission does not regulate or approve petroleum prices in a deregulated downstream market. Our responsibility under the Federal Competition and Consumer Protection Act, 2018, is 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.”
According to Bello, international crude oil prices have fallen sharply to about $73 per barrel following the ceasefire agreement involving the United States and Iran and the reopening of the Strait of Hormuz.
The commission observed that although crude oil prices have largely returned to levels recorded earlier in the year, the reduction has not been matched by a corresponding decline in domestic fuel prices.
FCCPC stressed that consumers deserve to benefit from favourable market conditions just as they bear the burden of price increases during periods of rising crude oil prices.
The commission reiterated its commitment to monitoring developments in the petroleum market and ensuring that businesses operate in a fair, transparent and competitive manner.
