Oil marketers in the country have questioned claims by the Nigerian Midstream and Downstream Petroleum Regulatory Authority that Nigerian National Petroleum Company Limited has petrol stock that could last for 34 days.
The oil marketers argued that the products are “hanging on the high sea”.
Former Chairman, Major Oil Marketers Association of Nigeria, and Chairman/Chief Executive Officer, 11 Plc, Tunji Oyebanji, told T on the sideline of the Institute of Change Management lecture and dinner on ‘Impact of Insecurity and Oil Subsidy on Nigeria’s Economy’ held in Lagos that majority of the products purported to have been imported by the NNPCL were yet to get to the depots and retail stations.
“The issue is that the quantity of fuel available is one thing, the other thing is that where is the fuel? If you have fuel but it is on the high sea, and not in the tanks in the depots and petrol stations, then, you have a problem. The issue is not the quantity available offshore, but what is really available in everybody’s tank and petrol stations. So, we are working hard on the logistics to make it easier and quicker to make products get into our depots and stations, and by extension, they get delivered to the petrol stations. So, it is not about the figures or stock available,” he said.
A recent exclusive by had exposed how foreign suppliers of petroleum products to NNPCL placing a financial lien (embargo) on product cargoes due to the inability of the state oil company to pay in cash.
A source in the oil sector had last week told that imported products were hanging on Lagos waters as importers had refused to release products.
also gathered that importers had rejected NNPCL’s crude/futures payment on imported petroleum products.
Until a few days ago, the government agency responsible for fixing all petroleum prices in the downstream sector, NMDPRA, had remained mum, especially since the series of scarcities experienced in the year. H had put several calls and messages across to its spokesperson, Kimchi Apollo, but did not receive a response.
Although Apollo said FG had no intention to increase the price of PMS, and that NNPCL had imported PMS with current stock levels sufficient for 34 days, prices have shut up to between N170 and N250 per litre, depending on the filling station and the location.
Black marketers are also smiling to the banks, as products now sell for as high as N500 per litre.
Oyebanji also said Nigeria will continue to witness recurring fuel scarcity until the federal government puts a stop to the current product importation by the state oil firm, NNPCL.
He described the current market as “not ideal”, saying it stiffens competition.
“It is usually very difficult to state one particular thing as responsible for fuel scarcity, while all along we have always advocated for deregulation so that there will be many suppliers in the industry. Today, there is only one supplier which is NNPCL. This is not an ideal situation. A market where there is a single supplier most likely will experience hiccups along the line. The fundamental solution is to free up the market, allow completion, and allow people to take up the importation, and distribution, such that if one supplier does not have, the other one will have,” he said.
Oyebanji also listed logistics as another cause of scarcity.
According to him, MOMAN, NNPCL and NMDPRA, also known as The Authority, are working to end the scarcity.
“We have consistently advocated for full deregulation. The government in its wisdom decided to postpone it for some months but I think it is inevitable. We will get there. We have no choice because the subsidy is taking away funds for other sector investments.
Chairman, Depots Association of Petroleum Products Marketers Association of Nigeria, Winifred Akpani had also partly blamed the scarcity and price hike on NNPCL’s monopoly.
According to her, depot owners are currently facing forex scarcity, hampering them from importing petroleum products.
The amount that we spend on subsidies in Nigeria is preventing investment in critical areas of the economy, which is worsening unemployment. By extension, with so much unemployment, a lot of people are out of job and it leads to insecurity. And if we don’t change the narrative such that subsidy is channelled into productive areas of infrastructure, power, and industry, the economy will not grow at the expected pace. For instance, today, our GDP is barely breaking even whereas our population continues to grow at 2.3 percent. When you have this kind of situation, you continue to have unemployment and this leads to insecurity,” he said.
