PPPRA explains how N87 pump price of petrol was arrived at

The Petroleum Products Pricing Regulatory Agency, PPPRA,
has given insight into how it arrived at the new petroleum
pump price of N87 per litre, asserting that it was informed by
components of the prevailing petroleum products pricing
template.
This pricing template indicates the ex-depot price, which is
the price that marketers of the product are to pay for products
they lift, and the expected open market price of petroleum
products.
Disclosing this on Monday, the Executive Secretary of PPPRA,
Farouk Ahmed, explained that based on the landing cost of
N74.35 per litre of PMS as at the close of business on Friday,
January 16, 2014, the addition of distribution margin of
N15.49 per litre would translate to an open market price, or
pump price of N89.84 per litre.
He held that the price is actually N2.84 higher than the N87
per litre approved by the Federal Government and announced
on Sunday by the Minister of Petroleum Resources, Mrs.
Diezani Alison-Madueke.
As such, he drew the attention of Nigerians to the fact that
the Federal Government would still be subsidizing the new
petrol price by N2.84 per litre.
The PPPRA boss then charged marketers to adhere strictly to
the new price regime, stressing that his agency would work
with the Department of Petroleum Resources, DPR to enforce
compliance to ensure that consumers benefited fully from the
new review.
While threatening that, “any violation of the prevailing price
regime shall attract appropriate sanctions,” the agency
advised Nigerians to avoid all forms of panic-buying, assuring
that there are enough products in all depots across the
country.
( DAILY POST )