NMDPRA threatens licence loss as petrol stations short-change

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has threatened to revoke the licences of petrol stations that persistently under-dispense petroleum products, as consumers already battling petrol prices of up to N1,500 per litre face the additional risk of receiving less fuel for their money.

The regulator said it had intensified nationwide inspections after identifying cases of inaccurate dispensing at retail outlets and warned that serious or repeated violations would attract sanctions, including withdrawal of operating licences.

The NMDPRA directed all petrol stations to immediately calibrate and verify their pumps and totalisers to ensure motorists receive the quantity of fuel displayed and paid for.

The warning comes at a particularly sensitive time for consumers. With petrol prices now around N1,400-N1,500 per litre in some locations, any shortfall in quantity effectively increases the real price paid by motorists and raises transportation and business costs.

For example, a customer who pays N14,000 for 10 litres but receives materially less fuel is effectively paying a price above the posted pump rate. Across thousands of transactions, such practices can impose a high hidden cost on households, transport operators, logistics companies and businesses.

The NMDPRA said it would take immediate enforcement action against outlets with improperly calibrated equipment or other dispensing irregularities.

“Persistent or serious violations will be subject to appropriate sanctions, up to and including revocation of the outlet’s licence,” the Authority said.

It also directed the Major Energy Marketers Association of Nigeria, Depot and Petroleum Products Marketers Association of Nigeria, Independent Petroleum Marketers Association of Nigeria and Petroleum Products Retail Outlets Association of Nigeria to notify their members and ensure compliance.

The crackdown forms part of a wider surveillance drive by the regulator following the recent increase in petrol prices.

While the downstream market is deregulated and pump prices are determined by market forces, the NMDPRA has stressed that deregulation does not permit operators to breach measurement standards, exploit consumers or compromise product quality.

The Authority said it was also working with the Federal Competition and Consumer Protection Commission and security agencies to monitor price gouging, collusion, under-dispensing, product quality and the diversion of petroleum products through border routes.

The wider market is also facing renewed pressure from movements in global oil prices. Crude prices have fallen from recent highs as supply concerns ease, although geopolitical risks remain capable of driving sharp price movements. Reuters reported on Tuesday that Brent was around $99.94 a barrel, following a decline in global supply concerns.

A sustained decline in crude prices could eventually ease local petroleum costs, although the NMDPRA has maintained that pump prices remain market-driven.

For consumers, however, accurate measurement is just as important as the headline price. At N1,500 a litre, Nigerians can no longer afford a fuel market where the quantity delivered at the pump falls below what they have paid for.

The enforcement therefore goes to the heart of Nigeria’s deregulated fuel market: operators must be free to price according to market conditions, but consumers must receive the full product for which they have paid.