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And if the naira climbs against the dollar, without even the government pegging the price of the exchange rate for dollars in the pricing of that group, we will see a reduction in the price automatically,” the CORAN spokesman stated.
Idoko also pointed out that selling crude in naira would reduce the nation’s dependence on foreign exchange by about 40%, as a significant portion of the country’s foreign currency goes towards importing petroleum products.
To significantly lower petrol prices, Idoko recommended that the Federal Government sell crude to local refineries in naira and peg the exchange rate for these transactions at ₦1,000 to the dollar.
The Publicity Secretary of CORAN, Eche Idoko, shared with Sunday PUNCH that the ₦898 per litre price quoted by the Nigerian National Petroleum Company (NNPC) for petrol purchased from Dangote’s refinery was a result of the high exchange rate.
However, Idoko stated that with the exchange rate capped at ₦1,000 to the dollar for locally-produced petroleum, the price could fall to ₦550 per litre.
The currency you are receiving is your own.” He concluded that, with this intervention, Nigeria could stabilise petrol prices at under ₦600 per litre using domestic resources without relying on foreign exchange, ensuring a more sustainable approach to fuel pricing in the long term.
In his final analysis, Idoko noted that a litre of petrol from Dangote’s refinery costs about $0.52, which equates to ₦842.61 at the current exchange rate of ₦1,637 to the dollar.
You will sell in naira at a discount, and then at that discount, you will peg the price at a particular exchange rate to the dollar.
“For instance, you can say, you are using ₦1,000 as an exchange rate for this dollar deal, for the locally refined petroleum products.
“NNPC supplied 60 per cent of that crude and the remaining percentage was imported by Dangote at the international price.
However, if the exchange rate were pegged at ₦1,000, the price would drop to ₦550 per litre.
Asked if he is certain that the government can cap the dollar rate at ₦1,000, Idoko retorted, “For this intervention, yes.
He further emphasised that even at ₦898 per litre, NNPC is purchasing the fuel at a rate ₦300 less than the landing cost of nearly ₦1,200 per litre for imported petrol.
“If you remember, we did say that if we begin to refine locally and there is a naira sale, the price of PMS will drop.
The crude belongs to the people now, and it’s NNPC’s crude..
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