‘West African pricing will stop imposing fuel costs on Nigeria, others’
Engr. Daniel Dayo Kunle, popularly known as Dan Kunle, is a renowned energy expert. In this interview, he speaks on the move by Nigeria and other West African countries to have a fuel pricing that recognises its role as a global player in refined petroleum products. He believes the continent already has an advantage with […]
Nigerian energy expert, Dan Kunle, discusses the West African fuel pricing framework and its impact on the region. The framework aims to establish a benchmark for fuel prices within West Africa, allowing countries to compete on a global scale. The recent arrival of the Dangote Refinery has given West African nations the ability to dictate their own fuel prices, previously being price takers.
Kunle stresses the importance of crude production in the Gulf of Guinea for the success of the framework, as inadequate production could render the price referencing system ineffective. The Nigerian government has introduced incentives for offshore investors to boost exploration and production. Kunle also highlights the potential for incentivising onshore assets and inland basins.
To achieve credible price discovery and regional trade, the Central Bank of Nigeria must collaborate with S&P and the Nigerian Midstream, Downstream Petroleum Regulatory Authority (NMDPRA) to create an e-Naira that can freely float within West Africa. This move would help eliminate currency-based disadvantages for traders, promoting the growth of the region's economy.
The government should also consider privatizing the government-owned refinery to foster competition with Dangote Refinery.
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