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The Trade Union Congress (TUC) has warned that any attempt by downstream petroleum regulators to cap prices of petroleum products could drive investors away from Nigeria’s oil and gas sector and undermine confidence in the deregulated market.
TUC President, Festus Osifo, gave the warning while speaking with journalists on the sidelines of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) homecoming dinner held in his honour at the Wheatbaker Hotel, Lagos.
Osifo, the immediate past President of PENGASSAN, urged the government and regulators to focus instead on creating a competitive downstream petroleum market, arguing that increased competition among industry players would ultimately lead to lower prices for consumers.
He said although investors naturally seek to maximise returns, attracting more players into the sector would create the competitive pressure needed to protect consumers and moderate prices.
“I think that price capping will come with greater challenges. If we focus on price capping, we are going to drive away investors,” Osifo said, urging the government to concentrate on measures that would encourage more investment in the sector.
According to him, regulators should prioritise attracting investors to build more refineries, including modular and larger-scale facilities, so that operators can compete effectively and increase domestic petroleum production.
“When we have competition, it naturally brings down prices. What the regulator should do is to source for more investors; source for people to build the refineries, both modular and the bigger refineries, so that they can compete, most especially with the international price,” he said.
Osifo maintained that sustainable and fair energy pricing could not be achieved through blanket price controls, which he argued could distort market forces. “Achieving sustainable, fair energy pricing requires deep upstream and midstream reforms rather than blanket price caps that distort the market,” he said.
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The TUC president also used the occasion to highlight what he described as one of his major achievements during his six-year tenure at the helm of PENGASSAN — the successful protection of workers’ jobs during the divestment of assets by Internationals Oil Companies (IOCs).
He noted that no PENGASSAN member lost his or her job as a direct consequence of the transfer of oil and gas assets from international operators to new investors, despite widespread concerns over possible job losses arising from the restructuring of the industry.
Osifo said the union went beyond protecting workers from redundancy by ensuring that their remuneration was maintained and, in several cases, improved during the ownership transitions.
He described the achievement as particularly significant given the scale of restructuring in Nigeria’s oil and gas industry, where several international operators have been divesting assets and transferring operations to new investors.
According to him, PENGASSAN deliberately engaged both outgoing and incoming operators to ensure that employees did not become casualties of the industry’s changing ownership structure.
Osifo said job protection and improved remuneration should therefore remain key benchmarks for assessing the performance of the union’s leadership, stressing that PENGASSAN also maintained close engagement with members at the branch level, particularly during negotiations on Collective Bargaining Agreements (CBAs).
“Because in each of their Collective Bargaining Agreements, if the people don’t see me there with them, they will see the zonal chairman. So, they saw that leadership worked with them closely,” he said.
“We never abandoned any of our branches. We worked with them closely to bring about the level of remuneration that we have in the oil and gas industry,” Osifo added, calling for continued engagement, investment and competition as the government seeks to stabilise the downstream petroleum sector.
