Petrol landing cost drops amid decline in global crude prices

The landing cost of petrol in Nigeria has decreased to N981 per litre.

The Major Oil Marketers Association of Nigeria (MOMAN) on Thursday made the announcement.

This marks a significant drop of over N140, down from the previous landing cost of N1,130 per litre, as of September 25, 2024.

The reduction in landing cost is attributed to the recent fall in global crude oil prices, with crude trading at $71.41 per barrel on Thursday, down from $73.46 per barrel the previous day. The data was provided by Nigeria’s Petroleum Ministry.

According to Statistica, a global analytics firm, the average price of Brent crude was $80.36 per barrel in August 2024. However, oil prices have since fluctuated, hovering between $70 and $75 per barrel so far in September.

The cost of refined petroleum products such as petrol, diesel, aviation fuel, and kerosene is heavily influenced by global crude oil prices and exchange rates. Brent crude, the international oil benchmark, saw its average price exceed $80 per barrel in August but has trended lower recently due to a combination of reduced demand from China and indications from the Organisation of Petroleum Exporting Countries (OPEC) that production levels may rise.

“This decrease in oil prices is primarily driven by lower demand in China and OPEC’s announcement of potential production increases,” Statistica noted in its report.

The decline in petrol landing cost is a relief for oil marketers and consumers, but the volatility in global oil markets and foreign exchange challenges remain key factors to watch as they continue to influence fuel prices in Nigeria.