Introduction
1.1 Background Of The Study
Oil is one of the natural resources that is considered significant to the socio-economic development of the entire citizen and all the sectors of the economy. Petroleum product (fuel) obtained from refinery processing of crude oil is significant to the transport sector as it serves as fuel for vehicles being used for the transportation of commuters and goods from one place to the other.
The manufacturing sector of the economy also make use of petroleum products (fuel) for the operation of machines and lubrication of the machineries. In the same vein, the petroleum product is significant to Agriculture sector, since it is used to operate the tractors and other agricultural machineries. Thus, the effects of scarcity or increase in price of the petroleum affects all the sectors of the economy. Attempt at increasing the price of petroleum product (fuel) is often accompanied by scarcity of the commodity in the society, this situation often bring about long queued in the filling stations which often result in stampedes sometimes causing commotion and fight among commercial drivers and other petroleum users in the society.
As a result of these negative effect on the lives of the citizenry, the people often prefer an increase in the pumping price of the product so much as the products shall be available than situations whereby there is no change in pumping price, but excavating due to hoarding which often stampedes commotion and sometimes avoidable loss of lives at the filling stations. However, experience has shown that the resultant increase in pumping price of petroleum products (fuel) bring about hardship to the society in the first instance, the commercial vehicle operators increase the fare price which effect often bring disaffection of the commuters, also the price of agricultural products will also skyrocket as a result of the increase in pump price which is shifted to the consumer by traders who transport these products from the rural areas to the metropolis. Prices of other goods such as vehicle spare parts also skyrocket for the same reason.
Thus, the effects of increase in price of petroleum products (fuel) affect the entire sector of the economy adversely.
The above scenario necessitated an investigation to this an all important issue of petroleum product (fuel) pricing and its distribution as it shall be focus of this research study.
1.2 Statement Of The Problem
The study intends to investigate the effect of price increase in petroleum product (PMS) on commercial vehicle transporters in Lokoja metropolis. The increase in petroleum products (PMS) price often result in an increase in fare charged by commercial transporters, this situation leads to general increase in price of goods and services, noticeable effect on transporters is that many commuters reduce their movement only to important or essential journey, thereby reducing the total sum normally earned in the transportation industry. The resultant effect includes, friction between commercial drivers and their
employers which may result in loss of job for the drivers and other antecedent effect to transportation industry as a whole. Problems identified above have exerted a lot of hardship on the people and economy of the country to the extent that the poor were the worst hit. The study suggested some means that could be put in place by government to ensure constant supply of PMS (premium motor spirit) and remove some of the bottlenecks to achieve effective and adequate public passenger transport service in Lokoja Metropolis.
1.3 Significance Of The Study
The study is beneficial to employers of commercial vehicle to educate them on the problems faced by drivers in the course of getting fuel for their transport activities, and enable effective evaluation attitude of commuters when increasing fares. This will reduce fictions between employers and employees concerning money delivered at the end of the day’s work and normalize strained relation often encountered by drivers and commuters.
The study is also beneficial to the government on its strategies towards controlling vehicle fare and efforts towards controlling activities of black marketers often associated with price hike of petroleum products.
It is also useful to the management of NNPC toward effective management of fuel distribution to reduce bottle neck often associated with petroleum (fuel) distribution from depots and atimes when bridging is employed.
The study serves as a useful resource for students of petroleum technology and those already in the field in developing their knowledge. The material contents of the study serve as a useful bibliography tool for further research works.
1.4 Purpose Of The Study
The main aim of these study is to investigate the effect of price increase in petroleum product (PMS) on commercial vehicle transporters in Lokoja Metropolis.
The study also sought to identify effect of the price increase of petroleum product on inflation and the distribution of price of other products, commuters vehicle fares, to identify its effect on un-employment which lead to less consumption by consumers and ultimately lead to low capacity utilization and stagnate growth of the economy, it increase crime rate lead to more friction at home which can precipitate more marriage breakups and can further widen the gap between the poor and the greedy rich in the society.
1.5 Research Hypothesis
For the purpose of this study, it is important that working hypothesis be formulated. To this end the following hypothesis are hereby proposed:-
- Hi: The increase in fuel price affect commuters in Lokoja Metropolis
Ho: The increase in fuel price does not affect commuter in Lokoja metropolis. - Hi: Fuel price hike have effect on price of goods and services in Lokoja Metropolis.
Ho: Fuel price does not have any effect on the price of goods and services. - Hi: Fuel price affect daily earnings of transport operators in Lokoja Metropolis.
Ho: Fuel price does not affect daily earning of transport operators.
1.6 Scope Or Delimintation Of The Study
From the topic of research study, the interest is principally limited to the effect of price increase in petroleum product (PMS) on commercial vehicle transporters in Lokoja Metropolis. The target of this research study is the ABC Transport Company Plc and National Union of Road Transport Workers (NURTW) Lokoja terminal.
The study review how increase of petroleum products prices affect the ABC Transport Company and National Union of Road Transport Workers and it’s antecedents effect on commuters.
1.7 Limitation And Constraints
The problems encountered which are obvious today is lack of enough information and documents from the library and ABC Transport Company Plc Lokoja Terminal due to the level of corruption in the nation.
There are also another problem as the period of the project work is becoming more injurious. To crown it all, finance of the project is yet a barrier.
1.8 Definition Of Key Concepts Or Terms
Commuter
Those who patronize commercial vehicle
Petroleum products
petrol (PMS), Kerosine (DPK) Diesel (AGO), Engine Oil.
Subsidy
Money paid by government to make price lower
NNPC
Nigerian National Petroleum Corporation
SAP
Structural Adjustment Programme
GDP
Gross Domestic product
PTF
Petroleum Trust Fund
IMF
International Monetary Fund
NPDC
Nigeria Petroleum Development Company
PPMC
Pipeline & Product Marketing Company
NGO
Nigerian Gas Company
PHRC
Port Harcourt Refinery Company
PTD
Petroleum Tanker Driver
OPEC
Organizational Of Petroleum Exporting Company
PPPRC
Petroleum Product (Fuel) Price Regulatory Committee
PEF
Petroleum Equalization Fund
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