The Central Bank of Nigeria (CBN) says the lifting of petroleum products from Lagos-based Dangote Refinery will moderate the cost of transportation and ease food inflation, as it lowers forex demands for petrol importation.
CBN Governor Olayemi, Cardoso said this at a press briefing on Tuesday, at the end of the 297th meeting of the Monetary Policy Committee (MPC), in Abuja, adding that the committee expressed optimism that the lifting of refined petroleum products from Dangote Refinery will moderate transportation costs and significantly support the easing of food price pressures in the short to medium term.
Cardoso also said this is also expected to moderate foreign exchange demands for importation of refined petroleum products with a positive spillover on external reserves and improvement in the overall balance of payment position.
The Consumer Price Index report recently released by the National Bureau of Statistics (NBS), the headline inflation rate eased to 32.15 percent in August 2024, while food inflation stood at 37.52 percent in the same month.
Cardoso said, “On food inflation, the upside risk remains flooding, hike in energy prices, scarcity of PMS, and most importantly, security in farming communities.
“Considering the weight of food in the CPI basket, which measures inflation, MPC members recognize the efforts of the Federal Government in addressing insecurity in the farming community and stressed the need to remain steadfast, and applauded the ongoing efforts of the Federal Government to bridge the supply deficit through duty-free import windows for food commodities”, he added
The Nigerian National Petroleum Company Limited (NNPCL) began loading the first batch of petrol from the Dangote Refinery mid-September, and said it got petrol at N898 per litre from the private refinery.
Meanwhile, the Independent Petroleum Marketers Association of Nigeria (IPMAN) has said that it doesn’t make sense to sell petrol lifted from the Dangote Refinery higher than imported ones.
Prices of petrol tripled since the removal of subsidy in May 2023, from around ₦200/litre to over ₦1000/litre, compounding the woes of the citizens who power their vehicles, and generating sets with petrol, no thanks to decades-long epileptic electricity supply.
