Crude price fall: FCCPC frowns at exploitation in oil market

● To sanction profiteers

The Federal Competition and Consumer Protection Commission (FCCPC) has raised the alarm over alleged exploitation in the downstream petroleum sector, saying pump price reductions have not matched the sharp decline in global crude oil prices.

In a statement, the Commission said its ongoing market surveillance shows that local refiners, depot operators, marketers, and retail outlets have implemented only “token” price cuts, despite crude falling significantly on the international market.

–“Markets must work fairly in both directions”-

The Executive Vice Chairman/CEO of FCCPC, Mr. Tunji Bello, said the Commission does not set or approve fuel prices in a deregulated market.

“Our mandate 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 practices,” Bello stated.

He added: “We are concerned that while dealers respond swiftly by hiking pump prices whenever crude rises, it is taking forever for consumers to benefit when crude falls. Competitive markets must work fairly in both directions.”

–Sharp drop in global crude not reflected at pumps–

Crude oil has fallen to $73 per barrel, down from a peak of $120 in April, following a U.S.-Iran ceasefire and the reopening of the Strait of Hormuz. Global prices have since returned to February levels.

During the April-May spike driven by tensions in the Gulf, local pump prices rose rapidly, with petrol hitting between N1,350 and N1,500 per litre, and diesel reaching N2,000. In February, petrol averaged between N800 and N900.

Today, petrol still averages about N1,200 nationwide, while some local refiners have set gantry prices between N1,025 and N1,075.

–Commission warns of enforcement action–

FCCPC acknowledged that domestic prices are influenced by refining costs, foreign exchange, logistics, financing, and distribution. However, it said competitive market forces should have transmitted cost efficiencies to consumers more quickly.

“Market liberalisation does not diminish businesses’ obligations to compete fairly or consumers’ right to fair treatment,” Bello said.

He added: “Where credible evidence indicates conduct that undermines competition or exploits consumers, the Commission will investigate and take appropriate enforcement action.”

He urged consumers to report suspected anti-competitive conduct, misleading pricing, or other unfair practices through FCCPC’s official complaint channels.

The Commission’s press statement was signed by Ondaje Ijagwu, its Director, Corporate Affairs.