Nigeria is grappling with a fresh petrol scarcity that has driven prices up significantly across the country. While the Nigerian National Petroleum Company Limited (NNPCL) attributed the problem to logistical challenges, oil marketers have expressed skepticism about this explanation.
Why it Matters
The scarcity, which began last week, has led to long queues at filling stations and black market prices as high as ₦1,200 per litre. Prices at regular stations have also skyrocketed, with some areas selling petrol for as much as ₦850 per litre, compared to the pre-scarcity price of around ₦610 per litre.
Despite NNPCL claiming to have resolved the logistical issues, oil marketers remain in the dark about the specifics of these challenges. They also deny accusations of hoarding products, emphasizing their business is to sell petrol and not store it.
What They Are Saying
The Chairman of IPMAN Satellite Depot, Lagos, Akin Akinrinade, highlighted that NNPCL stations are the ones primarily selling petrol, while independent marketers are struggling to obtain supplies. He believes that if more product is made available to independent stations, the queues would disappear quickly.
“We are extremely distressed and depressed by the laidback attitude of the leadership of the Nigerian Midstream Downstream Petroleum Regulatory Authority (NMDPRA), towards the survival of our member’s businesses, arising from NMDPRA’s deliberate delay and refusal to offset the debt of over ₦200 Billion owed our members, which has consequently led to the deaths of many of our members and the unfortunate collapse of their businesses.”
Former MOMAN chairman, Tunji Oyebanji, now CEO of 11 Plc, accused NNPCL of deliberately starving oil marketers of product. He claims they are not receiving enough fuel to meet demand, and the high landing cost of petrol makes it impossible to sell at the official pump price without incurring significant losses.
“(There is) no petrol because NNPCL is not giving us fuel. According to them, they don’t have smaller vessels to take the fuel from the larger vessels. Others are saying its because of bridging claims. They are not telling us the truth, because, as I speak, I don’t have fuel in my depot. I am going around begging for fuel,” he said.
“If you tell NNPCL you need say like 80, 000 tons of product now, they will give you 10, 000 tons. So, you will sell small, and then everything goes dry again.
“If they claim they have fuel, and no products in our tanks, then, it still translates to a no-fuel situation. Again, NNPCL is selling to us at around N600 per litre, and as of today, the landing cost of gasoline at the international market is ₦847 per litre.
“So, if I buy at ₦847/litre and add other costs, the pump price will be about ₦1400 per litre. So, if I sell at that price in my station, who will buy it? Even we marketers can’t buy much at that price. So, we continue to manage the situation.
Oyebanji also pointed out that NNPCL is the sole importer of petrol, and their alleged slow response to the situation is further exacerbating the scarcity. He questioned the feasibility of independent marketers importing fuel themselves due to the high exchange rate.
Further complicating the situation is the possibility of an imminent price increase, which has fueled speculation and panic buying. Additionally, IPMAN has threatened to withdraw services over non-payment of a ₦200 billion bridging claim owed by the Nigerian Midstream and Downstream Petroleum Regulatory Commission (NMDPRA).
Bottom Line
While the NNPCL has assured Nigerians of an improvement in the supply chain, the current petrol scarcity is causing significant hardship and economic disruption. Oil marketers remain unconvinced by the official explanation and urge NNPCL to provide more transparency and address the underlying issues effectively.
