The global crude oil market has continued to see a sustained price increase.

As at Thursday, the price hovered around $73/74 per barrel.

This is both good and bad news for an economy like Nigeria’s that depends on crude import as well as imported refined petroleum products.

The good news is that more petro-dollars will continue to pump into government coffers.

The bad news, however, is that as crude price increase, price of refined petroleum products will also increase.

This means as Nigerian earns more from crude, it is going to spend even more on fuel importation.

As a result, the expected open market price of petrol being imported into Nigeria may have risen above 190-naira as crude oil price climbed towards $75 per barrel.

As of March 20, 2018, when the international benchmark for oil prices, Brent, traded around $66 per barrel, the expected open market price of petrol, according to data obtained from the Petroleum Products Pricing Regulatory Agency, was around 189-naira per litre.

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Brent, against which Nigeria’s crude oil is priced, touched $74.75 per barrel last Thursday, having gained 10% since the start of this month. It traded around $74.68 as of 4:30PM Nigerian time on Thursday.

“If we keep the price of petrol fixed and there is an increase in crude oil prices, the price of petrol will rise, and somebody has to pay for it, whether the NNPC or the Federal Government.

“Somebody has to pay more and that has to come in the form of subsidy,” the Chairman/Chief Executive Officer, International Energy Services Limited, Dr. Diran Fawibe, told Punch on Wednesday.

He stressed the need for the country to ramp up local refining of crude oil in order to reduce the dependence on importation to meet the nation’s fuel needs.

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