The Nigerian National Petroleum Company Limited, (NNPCL) has allayed the concerns of Nigerians about the rising cost of Premium Motor Spirit, popularly called petrol, saying the price will come down in a matter of time.

The Chief Executive Officer of the NNPCL, Mele Kyari, predicted that competition among the key companies in the oil sector would drive down the price of petrol across the country soon.

In an interview with Arise TV’s Morning Show on Thursday, Kyari said the elimination of subsidies would permit new entrants into the market, a move that would help competition and gradually phase out a one-man-show in the Nigerian oil market.

He added that it would drive healthy competition which would over time drive down the price of petrol in the West African country.

He said, “The beauty of this (subsidy removal) is that there will be new entrants (into the market) because oil marketing companies’ reluctance to come into the market all along is the very fact of the subsidy regime that is in place.

“And that subsidy regime doesn’t have a guarantee of repayment back to the those who provide the product at subsidised price and now that the market is being regulated, oil marketing companies can actually import product or even if it is produced locally, they can buy and take it into the market and sell it at its retail price.

“Therefore, you will see competition, even with NNPC. And by the way, by law, NNPC cannot do more than 30 per cent of the market going forward. As soon as the market stabilises, oil marketing companies are able to come in.

“Competition will definitely come in and the market will regulate the prices itself. Therefore, this is just an instantaneous price and within a week or two, you will continue to see different prices because of different approaches from major players, companies have different approaches to it and competition will guide that. Ultimately, you’d see changes downwards and it is very likely because efficiency will come in.

As soon as competition comes in, people will become more efficient in their depots, in managing their trucks and in managing their fuel stations so that people can come to their stations. And it is showing already, right now, you will see motorists going to stations where they can have price differences, so this will regulate the market and on its own, the price will come down naturally and I don’t see any doubt about this.”

When asked why petrol stations across Nigeria increased their pump price when they still have the already subsidised products, the NNPL boss said “This is the reality of the market. It applies to every commodity and not just petroleum.”

Mele Kyari stressed that “It could have been the other way round, prices could have collapsed downwards and those holding the old stock will have to sell at lower prices to arrive at market condition.

“It is not something serious or strange, this is a stock management issue and it is very typical, no one can do anything different about this.

“The prices we are seeing today at our station are the current price of the commodity. This means that prices in the market can go down at any time and of course, the market will adjust itself.”