By Saidu Abubakar
The usage of the word “monopoly” certain stakeholders in the oil industry has vehemently been frowned at by a renown petroleum expert, Professor Wumi O. Iledare. He was reacting to a media report entitled “Price Crisis: NARTO, FCCPC, NMDPRA To Tackle Monopoly.”
Valuechain quoted the petroleum economist as saying “people often say Nigeria’s downstream sector is a “monopoly,” but that word is being used loosely. In economics, a monopoly means one seller completely controls a market with no real competitors. That’s a very strict definition.”
Omowumi O. Iledare, a Professor of Petroleum Economics and Policy Research who is also the Director of Energy Information Division of the Center for Energy Studies, pointed out that “what we actually see is market power — strong influence by a dominant player or a small number of players in a highly concentrated market. That’s not the same as a textbook monopoly. It’s closer to oligopoly or dominant-firm behavior.”
Professor Iledare who was the president of the United States Association for Energy Economics (USAEE) in 2008, highlighted that “the real issue is concentration and influence, not absolute single-seller control. Calling everything a monopoly can blur the analysis. Precision matters if we want serious policy conversations.”
