As Nigeria’s downstream petroleum sector navigates one of its most significant transitions in recent years, the Group Managing Director of Rainoil Limited, Dr. Gabriel Ogbechie has urged the Federal Government to adopt a fair and transparent pricing framework to prevent distortions in the evolving market structure.
Ogbechie made the call during a Mid and Downstream Transformation Debate at the Nigerian International Energy Summit in Abuja, according to a statement issued by the company, where stakeholders examined strategies for transforming downstream markets and refining.
“If oil is being produced locally, it is important that everyone prioritizes what is produced locally,” he said, stressing that pricing must be guided by equity, transparency, and fairness to all players, including consumers as Nigeria’s downstream sector adjusts to increased domestic refining capacity.
According to him, unpredictable or inequitable pricing could distort the market and ultimately destroy value rather than create it while noting that the sector is undergoing significant disruption following years of fuel scarcity as a result of several non-functional refineries and heavy dependence on imported petroleum products.
“Unpredictable or inequitable pricing could distort the market and destroy value rather than create it. Pricing must be fair to all stakeholders, including consumers, and predictable enough to allow operators to plan and invest with confidence,” he stated.
Beyond pricing dynamics, Ogbechie identified distribution inefficiencies as a major challenge confronting the downstream sector, criticizing Nigeria’s heavy reliance on road transportation to move petroleum products across long distances.
“It does not make sense to move petroleum products from Lagos to Sokoto by truck over a distance of more than 1,000 kilometers,” he said, describing it as economically unsustainable and harmful to national infrastructure.
“This country is wired underground through pipelines. Some of us were privileged to see these pipelines work. We need to go back to it,” he added.
Ogbechie stressed that addressing pipeline vandalism and theft through intelligence-driven monitoring and stronger legal frameworks would be crucial to restoring confidence in pipeline transportation and reducing overdependence on trucks.