With tariff hikes in two key sectors, Nigeria is among the Organisation of Petroleum Exporting Countries (OPEC) having the most expensive petroleum products and the sixth-highest energy cost in Africa.
According to official data sourced from Globalpetrolprices.com, only citizens of Ecuador, Congo, Iraq, Saudi Arabia, and the United Arab Emirates would henceforth spend more on the premium motor spirit (PMS) than those of Nigeria in the OPEC community.
The product is at least 20 times and six times costlier in Nigeria than in Venezuela and Iran respectively. It is also three times more expensive in the country than it is in Sudan, another Africa’s oil-producing country. In Angola, a country declared as one of the most expensive countries to live, PMS is about 50 percent cheaper than in Nigeria.
With automotive gas oil (AGO), otherwise known as diesel, selling for about N220, the cost of the product is about 50 percent lower than the global average. Yet, AGO is much more expensive in Nigeria than in most of the country’s OPEC peers. The cost of the product in Angola, Iran, Saudi Arabia, and Sudan is 75 percent lower than in Nigeria.
Businesses in other OPEC members such as Algeria, Angola, Ecuador, Qatar, and Kuwait also spend far less on AGO than their counterparts in Nigeria. Egypt, Ethiopia, and Tunisia are among Africa’s leading economies where AGO is cheaper than in Nigeria, a leading oil producer.
From data supplied by the platform, the recently doubled cost of electricity has pushed Nigeria up the cost radar as one of the African countries with the most expensive energy. Whereas the average global cost of electricity is N55.36 and N49.71, for kilowatt units of energy per hour (kWh) for households and businesses respectively, Nigeria’s consumers will henceforth pay as much as N62 kWh.
Consumers in Ghana, whose industrial sector seems to have been positioned to compete for Nigeria’s market, are charged N24.5 kWh on average. Besides its efficiency advantage, South Africa, Nigeria’s strongest continental competitor, provides its citizens with cheaper energy than Nigeria does.
Considering the new charges, Nigeria can only pull ahead of Kenya and other fringe economies such as Togo, Burkina Faso, Gabon, and Cape Verde in the continent’s race to achieving energy cost competitiveness.
The Minister of Information and Culture, Lai Mohammed, at a press conference held in Abuja on Monday, said: “Despite the recent increase in the price of fuel to N162 per litre, petrol prices in Nigeria remain the lowest in the West/Central African sub-region.”
However, the minister and his colleagues, who joined him in the briefing, did not draw a comparison between the cost of PMS in Nigeria and other traditional oil-producing countries.
The Petroleum Products Pricing and Regulatory Agency (PPPRA) may have also realised that its initial insistence that pump price is adjusted in line with the direction of the international market is no longer tenable.
On Wednesday, the agency retracted its earlier position, saying there was no relationship between prices of crude oil in the international market and the pump price of petroleum products in Nigeria, a statement many have described as contradictory.