Cooking gas, diesel prices may rise further as crude hits $84/barrel

There are fears prices of cooking gas and diesel may rise again following the continued increase in crude oil prices at the international market.

Crude oil on Monday recorded an increase of 1.36 per cent with the US West Texas Intermediate (WTI) selling at $84.71, while the Brent crude jumped by 1.36 per cent to $84.86.

Brent oil price crossed the $85 mark in October for the first time in three years before falling back to $82 a barrel last Wednesday.

Nigeria should naturally be happy with expected income from its crude oil sale but since the nation heavily depends on imported petroleum products for its domestic use, the Federal Government must be prepared to pay more for petrol subsidy as the fuel is currently being sold at a flat rate of N162 per litre at the filling stations nationwide.

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Other imported refined products such as diesel and cooking gas will have their prices skyrocket because market forces determinate their selling prices. And consumers of such products are already complaining of the current high prices.

Reports on Monday said the oil demand rose amid the gradual increase in the production quota of the OPEC+ alliance after the outbreak of coronavirus disease plunged oil prices to a low as -$37.63 last year.

On Thursday, OPEC+ will gather to review the benchmark for oil production. Nigeria, one of Africa’s top producers, is struggling to boost output to the quota set by OPEC.

In September, Nigeria’s oil production increased marginally to an average of 1.25 million barrels per day from 1.24 million the previous month. The country has been performing below the OPEC quota — from an average of 1.36 million barrels per day in January 2021 to 1.25 million b/d in September.