On Sunday, oil marketers signaled a looming increase in the cost of Premium Motor Spirit, commonly known as petrol, projecting a surge in prices ranging from N680 per liter to N720 per liter in the upcoming weeks. This projection is contingent upon the prevailing exchange rate of the dollar, which is currently oscillating between N910 and N950 in the parallel market.

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    Additionally, these oil marketers have disclosed that importers intending to bring in shipments of PMS are encountering obstacles due to the scarcity of foreign exchange required for the procurement of this essential commodity. The scarcity of foreign exchange has compelled these importers to reconsider and postpone their importation plans.

    The situation is further exacerbated by the insufficient liquidity within the Central Bank of Nigeria’s Importers and Exporters official foreign exchange window. Despite offering a comparatively lower exchange rate of approximately $740/litre, this official channel has been hampered by illiquidity, rendering it incapable of fulfilling the substantial financial demands ranging from $25 million to $30 million needed by dealers for the importation of PMS.

    In summary, the petroleum industry is bracing itself for an imminent price hike in petrol, as oil marketers emphasize the potential for prices to surge between N680/litter and N720/litre in the forthcoming weeks, provided that the dollar’s exchange rate remains within the N910 to N950 range. Concurrently, the scarcity of foreign exchange has impelled importers to delay their PMS importation plans, while the official foreign exchange window’s liquidity constraints have hindered its ability to meet the substantial financial requisites of petroleum dealers.

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