AN ASSESSMENT OF THE DOMESTIC DEMAND FOR PETROLEUM PRODUCTS IN NIGERIA (1986 - 2004)
AN ASSESSMENT OF THE DOMESTIC DEMAND FOR PETROLEUM PRODUCTS IN NIGERIA (1986 - 2004)
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Date
2007-02
Authors
ASAOLU, TAIWO MOSES
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Abstract
The contribution of petroleum industry to the Nigerian economy since 1970 has
been tremendous. The oil industry is very important to the Nigerian economy, it
provides, among other things, the greater part of the foreign exchange and total
revenue needed for the socio-economic and political development of the country.
The bulk of Nigerian crude oil is sold unrefined. When refined, the products range
from petrol to heavy liquids for road tarring. The bulk of petroleum products
consumption has been the premium motor spirit (PMS) or petrol, automotive gas
oil (AGO) or diesel. and dual purpose kerosene (DPK) has been the main thrust of
this study. The main focus of the study is to examine the trends of PMS. AGO
and DPK and the factors that influence the domestic demand for petroleum
products in Nigeria from 1986 2004. The study utilized the ordinary least square
technique in investigating the factors that affect the domestic demand for PMS.
AGO and DPK in Nigeria. Three sets of equations for each model were specified
and estimated i.e. 1970 -1985 (pre-oil regulation). 1986-2004 (during oil
regulation) and for the entire period of analysis 1970 - 2004. This was with a
view to identify the impact of these factors on domestic demand lor PMS. AGO
and DPK. Moreso. empirical investigation was carried out in Zaria from population of
100 consumers of PMS. AGO and DPK to buttress the regression
result as to what factors influences their demand for the products. The findings of
the regression result reveals that on the overall, price and income have no
significant impact on PMS from 1970-2004. Likewise, price have no significant
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impact on demand for AGO, while per capita income has significant impact on the
consumption of AGO from 1970-2004. Moreso. price have no significant impact
on domestic demand for DPK while per capita income reveals significant impact
on the consumption of DPK from 1970 2004. The result of primary data reveals
that uses of PMS. AGO and DPK have a significant impact on domestic demand
for petroleum products in Nigeria couple with other composite factors such as
price and uses, income and uses/revenue and uses. Therefore, to enhance effective
demand for petroleum products in Nigeria, the stud) suggested among others
appropriate pricing of petroleum products based on market forces, the over hauling
of the refineries and more participation of indigenous marketers on the supply and
effective distribution of petroleum products in Nigeria.
Description
A THESIS SUBMITTED TO THE DEPARTMENT OF ECONOMICS,
FACULTY OF SOCIAL SCIENCES, IN PARTIAL FULFILLMENT OF
THE REQUIREMENT FOR THE AWARD OF THE DEGREE OF
MASTERS OF SCIENCE IN ECONOMICS, AIIMADU BELLO
UNIVERSITY, ZARIA, NIGERIA.
FEBRUARY, 2007
Keywords
ASSESSMENT,, DOMESTIC,, DEMAND,, PETROLEUM,, PRODUCTS,, NIGERIA (1986 - 2004)