The Lagos Chamber of Commerce and Industry (LCCI) has proposed a six-month programme aimed at reducing petrol prices in Nigeria by 15 to 20 per cent to ease the rising cost of living and doing business.
The Chamber also projected a positive economic recovery by the second quarter, while urging the Federal Government to address high energy costs, expensive transportation and other factors affecting businesses and households.
In a statement issued on Sunday, the LCCI Director-General, Dr Chinyere Almona, called on the Federal Government to collaborate with domestic refiners, petroleum marketers, regulators and other industry stakeholders to achieve gradual, measurable and sustainable reductions in petrol prices.
Almona welcomed the government’s proposed petrol price stabilisation mechanism, describing it as a timely intervention amid rising energy and transportation costs.
According to her, the increasing cost of energy has continued to put pressure on business operations, reduce household purchasing power and weaken the competitiveness of Nigerian businesses.
The Chamber also welcomed the proposed price ceiling of ₦1,350 per litre on the ex-gantry or landing cost of petrol, subject to monthly reviews and public disclosure.
It described the proposal as an acknowledgement of the economic challenges caused by sharp fluctuations in energy prices.
However, Almona cautioned that stabilising petrol prices at already elevated levels would not provide enough relief for businesses facing high electricity tariffs, the cost of alternative power sources, expensive financing and rising logistics expenses.
She explained that although the proposed mechanism could protect businesses and consumers from sudden increases in petrol prices, it might not automatically translate into lower pump prices.
According to the LCCI director-general, the government should assess the policy based not only on its ability to control price fluctuations but also on whether it reduces operating costs and improves the welfare of Nigerians.
She further warned that requiring refiners and importers to absorb temporary increases in costs and recover the losses when market conditions improve could create financial obligations that may eventually lead to higher prices.
Almona stressed that such arrangements must be managed transparently to prevent unexpected increases in petrol prices and ensure that the policy delivers its intended benefits.
LCCI recommends measures to reduce petrol prices
To support the proposed six-month price reduction programme, the Chamber called on the Federal Government to ensure a steady and commercially viable supply of crude oil to domestic refineries.
It explained that reliable crude oil supplies would reduce procurement uncertainties, exposure to foreign exchange fluctuations and unnecessary logistics expenses.
The LCCI also urged the government to accelerate the development of alternative transportation systems, including compressed natural gas (CNG) and electric vehicle infrastructure, to reduce the cost of transporting goods and passengers across the country.
Other recommendations include removing transportation bottlenecks, improving storage and fuel distribution infrastructure, eliminating illegal charges and maintaining exchange-rate and broader macroeconomic stability.
The Chamber emphasised that clear guidelines must govern the proposed price stabilisation mechanism to prevent refiners and importers from accumulating unlimited losses.
According to Almona, poorly designed policies could discourage investment in the petroleum sector and create conditions that might lead to fuel shortages.
She noted that Nigeria could not permanently shield its petroleum market from changes in international oil prices, stressing that lasting relief would depend on reducing domestic costs that worsen the effects of global market fluctuations.
The LCCI maintained that the success of the proposed intervention should ultimately be measured by its impact on petrol prices, transportation expenses, distribution costs and the competitiveness of Nigerian businesses.
It added that the policy should deliver meaningful relief to consumers while creating a more favourable environment for businesses to operate, expand and contribute to economic growth.
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