Oil & Energy

PH Residents React To Petrol Price Preduction

Published

10 years ago

January 26, 2015

Since last week when
the Federal Government announced a reduction of N10 from the official price of the petrol pump price, in response to the fall in crude oil price at the global market, divergent views have continued to trail the action of the government.
Our correspondent who spoke with some of the residents reports that while some commend the reduction, others see it as a new campaign strategy of President Goodluck Jonathan to secure popularity and victory in next month’s general election, yet others feel reducing the pump price from N97 to N87 per litre was insignificant and not commensurate with the more than 50% fall of crude oil price in world market.
An economist and social analyst, Mr Jefat Edum, is of the view that the N10.00 reduction is quite insignificant compared to the big fall of crude oil price that is drastically devastating economies of oil-producing nations in the world.
“You can see the cries and woes of most companies in the sector and huge negative impact on the economies of oil-producing nations. One had expected that any slash in the petrol price should be significant to at least the point that it would reduce the cost of transport fares paid by Nigerians,” he said.
Edum is worried that with over 50 per cent drop in crude oil price, at least N35.00 should be reduced, so that one litre can go for at most N52.00 and this would further enable transporters meaningfully reduce the fares charged Nigerians.
You can see the effect of the reduction is not felt at all because it has not reflected on the prices of fare as much as the crude oil price fall is impacting on oil-producing nations.
He urged the Federal Government to revisit the reduction and slash more so that a litre of petrol can sell for N55 or N62 for the interest of Nigerians.
Another respondent, Dr. Donald Alozie picked holes with the way and manner government arrived at the N10 reduction.
Alozie disagreed with the sidelining of other stakeholders in the reduction. “Imagine the Trade Union Congress and oil marketers opposing the reduction. That means that these two important stakeholders were not properly consulted and their inputs were not in such a crucial decision which impacts heavily on Nigerians.
He described the government’s decision and approach as undemocratic and should therefore be reviewed so that a more acceptable level of reduction is achieved.
“Government cannot just wake up one morning and make such decision without proper consultations with other stakeholders in the sector.”
He criticized the refusal of some petroleum marketers in Nigeria to revert to the new pump price.
But Tunde John, a Port Harcourt-based businessman said the reduction is in order. “It is a show of magnanimity of the government to announce price reduction of petrol pump price promptly without allowing a build up of sentiments that could have resulted in mass actions.”
John lauded the Federal Government’s action but cautioned that, “the N10 reduction should not be seen to be the last action. The trend should be studied and further actions which may require more readjustments be made.”
Also speaking in a similar tune, a taxi driver, Macleans Anderson said, “the reduction is a proof of government’s sensitivity to the plights of the people.
According to him, “all we have been hearing for the past decades is increase in petrol price but it is a thing of joy that the President Jonathan-led Federal Government broke the jinx by reducing the burden on Nigerian masses. I commend the government for doing that.”
Anderson views the refusal of petrol marketers in other parts of Nigeria as sabortage and urged the Directorate of Petroleum Resources (DPR) to take more drastic actions against defaulters.
“The marketers cannot be bigger than the Federal Government. Slash in petrol price was taken in the interest of Nigerian masses and any attempt by marketers to reject the order should be viewed as a move against the people and government and must be resisted,” he maintained.
But a political colouration was given to the order by Chief Mathias Njoku. “If you look at the timing, you will see that because the president is desperate now to return for a second term, he has decided to make the reduction few weeks to the election time.
“Yes, we know that oil price has fallen in the global market but this has been on since last year, why did it take the Federal Government this long to take such decision,” he querried.
Nkoku said the aim of Federal Government is to win the sympathy of some gullible Nigerians whose votes he desperately needs to return himself and his party to power.
However, to Etim Clement, a trader, “government has done well. Let the taxi and bus drivers also reduce their fares. Petrol now costs less, and what it means is that the transporters should equally reduce their charges otherwise the reduction is meaningless.”
Clement also wants reduction in other products such as kerosene, and gas since they are products of crude oil. “As the price of crude oil drops, not only petrol price should drop, let others as kerosene and gas also reduce.”
He particularly appealed to marketers in Aba, Calabar and other cities that have refused to readjust to be selling at the new pump price.
Clement advised the government to take steps that could improve the agricultural sector so that sector so that most Nigerians who lost their jobs in the oil companies as a result of the fall in crude oil price as well as other unemployed youths can be engaged in meaningful economic activities.
He regretted that Nigerian’s past leaders failed to plough back oil money to agriculture and other sectors for the economic development of the nation instead of concentrating on oil for national earnings.
“Inability to properly diversify our economy has remained our major problem in the country. Those involved in agriculture should be encouraged. Apart from providing employment and creating wealth, it would boost our foreign exchange base,” he noted.
The Petroleum Products Pricing Regulatory Agency (PPPRA), in defending the new pump price of petrol said it considered the fundamental trends in global crude oil market before arriving at the N10 reduction.
Executive Secretary of the agency, Mr Ahmed Farouk, who disclosed this in Abuja said even with the N87.00 per litre, the government was still subsidizing it with N2.50 per litre.
He explained that in determining the new price, government considered the economic implications on an average Nigerian.

Chris Oluoh

President Goodluck Jonathan

Oil & Energy

Hedge Funds Turn Bearish On Oil, Bullish On Natural Gas

Published

1 month ago

March 17, 2025

The Tide

Traders have not been this bearish on oil in months or so bullish on United States natural gas in years.
The latest data on money managers’ positioning in the WTI and Brent crude and U.S. natural gas futures showed two contrasting trends—speculators are betting that oil prices would remain low or go even lower while increasing the bets that natural gas prices would continue marching higher.
So far this year, geopolitical and supply and demand factors have been increasingly bearish for the oil price outlook and increasingly bullish for natural gas prices.
In the oil market, hedge funds and other portfolio managers have been slashing their bullish bets since the end of January, when the U.S. sanctions on Russia’s oil trade were the primary bullish driver of managed money to bet on a tightening market.
With U.S. President, Donald Trump, now in office, the sentiment has quickly soured amid the president’s insistence on lower oil prices, his efforts to broker an end to the war in Ukraine, and – most of all – the enormous uncertainty about on-and-off tariffs and tariff threats and their potential impact on the American economy.
As a result, market participants are preparing for lower oil prices, even amid expectations of declining oil supply from Iran and Venezuela due to President Trump’s hawkish policy toward these OPEC producers.
Speaking of OPEC, the wider OPEC+ group has just said it would begin increasing supply as of April, adding further downward pressure on prices.
Faced with all these bearish drivers, money managers have been reducing their bullish bets on crude oil futures, with the U.S. WTI Crude hitting the lowest net long position – the difference between bullish and bearish bets – in 15 years at the end of February.
In the week to March 4, the latest reporting week with data released on March 7, speculators bought WTI amid a major selloff in all other commodities except for U.S. natural gas.
The net long in WTI rebounded from the 15-year low, but it wasn’t because the market suddenly started betting on higher prices going forward. The rise in WTI buying and the net long was the result of short covering in the U.S. crude futures contract.
In Brent, hedge funds cut their bullish-only bets in the week to March 4 for the biggest decline in longs since July 2024.
Unlike in crude oil, money managers have become increasingly bullish on U.S. natural gas after inventories dipped this winter to below the five-year average as demand surged in the coldest winter for six years.
The net long in natural gas further swelled in the week to March 4, as the number of new bullish bets was four times higher than the new short positions.
“Natural gas continues to benefit from rising demand, both domestically in the US and towards exports via LNG,” Ole Hansen, Head of Commodity Strategy at Saxo Bank, said, commenting on the latest Commitment of Traders report.
At the start of the winter heating season in November, U.S. natural gas inventories were higher than average for the time of the year as America entered the season with stocks at their highest level since 2016.
These stocks, however, were quickly depleted during the coldest winter for six years, with demand for space heating and power generation soaring. A month before the end of the winter heating season, U.S. natural gas inventories have now slumped to below the five-year average and well below the levels from the same time in 2024, at the end of a mild winter.
The lower inventories and the higher demand – both for domestic consumption and LNG exports – have pushed prices higher, encouraging producers to boost gas output this year. Traders bet that prices will go even higher as demand from LNG plants is set to accelerate with the ramp-up of new U.S. export plants.
Paraskova writes for Oilprice.com.

By: Tsvetana Paraskova

Oil & Energy

Renaissance Finalises Acquisition Of SPDC

Published

1 month ago

March 17, 2025

The Tide

Renaissance Africa Energy Holdings says it has successfully completed the acquisition of 100 percent equity holding in the Shell Petroleum Development Company of Nigeria (SPDC).
Spokesperson of the company, Tony Okonedo, who disclosed this in a Press Release, Last Thursday, said Renaissance has completed all processes for the full transfer of ownership of SPDC to the consortium, adding that it will now operate as Renaissance Africa Energy Company Limited.
“Renaissance Africa Energy Holdings today announced that it has successfully completed the landmark transaction between itself and Shell for the acquisition of the entire (100%) equity holding in the Shell Petroleum Development Company of Nigeria (SPDC).
“This follows the signing of a sale and purchase agreement with Shell in January 2024 and obtaining all regulatory approvals required for the transaction. Going forward, SPDC will be renamed as ‘Renaissance Africa Energy Company Limited.
“Going forward, SPDC will be renamed as ‘Renaissance Africa Energy Company Limited’.
“Renaissance Africa Energy Holdings is a consortium consisting of four successful Nigerian independent oil and gas companies: ND Western Limited, Aradel Holdings Plc. FIRST Exploration and Petroleum Development Company Limited and the Waltersmith Group, each with considerable operations experience in the Niger Delta, and Petrolin, an international energy company with global trading experience and a pan African outlook”, the statement reads.
Speaking on the acquisition, the Managing Director/CEO, Renaissance Africa Energy Holding,Tony Attah, said Renaissance Africa Energy Company Limited has a vision to be the leading oil and gas producer in Africa and to help the continent achieve energy security.
Attah expressed gratitude to the Federal Government for its support and pledged the company’s commitment to the Petroleum Industry Act.
“We are extremely proud to have completed this strategic acquisition. The Renaissance vision is to be ‘Africa’s leading oil and gas company, enabling energy security and industrialization in a sustainable manner’.
“We and our shareholder companies are therefore pleased that the Federal Government has given the green light for this milestone acquisition in line with the provisions of the Petroleum Industry Act”, he said.
The CEO acknowledged the contributions of Nigeria’s Minister of Petroleum Resources, the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), and the Nigerian National Petroleum Company Limited (NNPCL) in facilitating the deal.
He said, “we extend our appreciation to the Honourable Minister of Petroleum Resources, the CEO of the Nigeria Upstream Petroleum Regulatory Commission (NUPRC), and the CEO of Nigeria National Petroleum Company Limited (NNPCL) for their foresight and belief, paving the way for the rapid development of Nigeria’s vast oil and gas resources as strategic accelerator for the country’s industrial development”.
The Statement further revealed that Renaissance partner companies collectively have an asset base of more than $3 billion and currently safely produce approximately 100,000 barrels of oil per day (bpd) from 12 oil mining leases and operate two functioning modular refineries in Nigeria’s Niger Delta.

Oil & Energy

Oil-Rich Communities Must End Infighting To Access Dev Funds – FG

Published

1 month ago

March 17, 2025

The Tide

The Federal Government has cautioned oil-rich communities against infighting and disruption of oil production, saying it could hinder their access to the Host Community Development Fund.
Minister of State for Petroleum (Oil), Heineken Lokpobiri, made the appeal while speaking at the KEFFESO Stakeholders Forum, in Yenagoa, Bayelsa State.
Lokpobiri noted that the Petroleum Industry Act (PIA) was enacted to bring stability to the oil sector and address longstanding grievances about underdevelopment in host communities.
He lamented, however, that internal disputes among stakeholders have made it difficult for these communities to access and utilize the funds meant for their development.
Lokpobiri insisted that host communities must overcome internal conflicts that hinder their access to the funds.
“This KEFFESO Stakeholders Forum is to see how host communities can maximize the benefits from the Host Communities Trust Funds as prescribed by the PIA.
“If oil production is disrupted, everyone loses — the Federal Government, oil companies, and the host communities themselves. That is why host communities must collaborate with the government and oil companies to ensure smooth operations” Lokpobiri stated.
The Minister called on Host Community Development Trusts (HCDTs) in the Niger Delta to effectively utilize the 3% operational funds allocated to them under the PIA 2021 to drive sustainable development.
He further called that oil-producing communities should take ownership of the oil and gas facilities within their domains and work with relevant stakeholders to ensure sustainable benefits.
“As stakeholders who have their respective stakes in oil and gas operations in the country, we should work together to ensure that we maximize the benefits of oil and gas.”
The minister also emphasized the global push for cleaner energy, warning that the relevance of fossil fuels depends on their extraction and marketability.
“Don’t forget there is a global campaign against the continuation of production of fossil fuel.
“Fossil fuel will never go away. Fossil fuel will not have any value unless you bring it out of the ground or from the sea to the market, that is why we need this collaboration,” he said.
In his remarks, the Executive Secretary, Nigerian Content Development and Monitoring Board (NCDMB), Engr. Omotsola Ogbe, reaffirmed the board’s commitment to leveraging the provisions of the Nigerian Oil and Gas Industry Content Development (NOGICD) Act.
Represented by the Board’s Director of Legal Services, Naboth Onyesoh, Ogbe noted that the NCDMB’s Community Content Guidelines were designed to ensure sustained community engagement as local content is prioritized throughout the oil and gas value chain.
Ogbe praised the KEFFESO Host Community Development Trust for its efforts in ensuring that oil revenues benefit local communities.
Also speaking, the Managing Director and Chief Executive Officer, First E & P, Ademola Adeyemi-Bero, described the KEFFESO Stakeholders Forum as a crucial platform for discussing and strategizing solutions to the challenges facing marginalized communities in the Niger Delta.
He reiterated the company’s commitment to fostering meaningful and sustainable development in the region.
The forum, themed “Envisioning Sustainable Community Development in Niger Delta Host Communities: Identifying Challenges and Actualising The PIA Paradigm Shift,” brought together key stakeholders to discuss strategies for maximising the benefits of the Petroleum Industry Act(PIA).