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OMCs with less than 45 outlets will not participate in G40 – NPA

February 23, 2023
OMCs with less than 45 outlets will not participate in G40 – NPA

The second consignment of petroleum products that have arrived in the country under the Government's Gold for Oil programme will be sold to (OMCs) with no less than 45 outlets across the country.

The (NPA) said the decision would ensure that consumers felt the impact of the programme in terms of reduction in prices of petrol and diesel at the pumps.

Speaking at a media briefing in dubbed: “The State of the Agencies Report” on Wednesday, Dr Mustapha Abdul-Hamid, Chief Executive, NPA, said the country had thus far taken delivery of three consignments of petroleum products under the Gold for Oil Programme.

He said apart from the 40,000 metric tonnes of diesel that arrived last month, another 40,000mt of petrol and 35,000mt of diesel arrived in the country last week, waiting to be discharged.

Dr Abdul-Hamid said although the first consignment was not enough to significantly impact prices at the pumps, some OMCs that benefited from that consignment had reduced their prices marginally while others did not.

“We are going to ensure that if you are supplying petroleum products under Gold for Oil, it should truly reflect prices at the pumps…The first consignment is not enough to cause a significant change in prices.

But even GOIL reduced its prices by 70p per litre, while others reduced by 10 to 20p per litre,” he said.

He added: “This time, the NPA Gold for Oil team has come up with a brilliant idea that in this second consignment, we are going to sell only to OMCs that have not less than 45 outlets.”

The Government announced the Gold for Oil Policy in November last year as an innovative measure to exchange gold for petroleum products instead of US Dollars.

The Government said the move was intended to reduce the demand for dollars for the importation of petroleum products and by extension reduce the rate of depreciation of the .

It is estimated that the country required about $400m to import petroleum products monthly – out of which the is able to supply only $120m to petroleum importers.

Meanwhile, some industry players have raised concerns about the ability of the Gold for Oil programme to affect the prices of petroleum products at the pumps.

Others have also expressed concern that the programme would amount to the Government interfering in the petroleum pricing regime in a deregulated market system.

Responding to the concerns, Dr Abdul-Hamid said the deregulated regime was still in force, adding that the Gold For Oil programme was intended to reduce the demand for dollars by the Bulk Oil Distributors (BDCs) and help to stabilise the local currency.

“The aim of the programme is to reduce the pressure on dollars used in the importation of petroleum products into the country and ensure that petroleum products are affordable at the pumps.

“Our goal is that the Gold for oil arrangement should account for 50 per cent of petroleum products imported into the country,” Dr Abdul-Hamid said.

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