Fuel scarcity to persist till mid April
The scarcity of petrol across the
country is assuming a new dimension with the product selling above the
official regulated pump price due to a combination of factors, DAYO
OKETOLA writes
The fuel shortage that has engulfed the
country in the past one month may not improve until the middle or end of
April as many marketers are currently finding it difficult to finance
the import allocations they recently got from the Petroleum Products
Pricing Regulatory Agency.
Our correspondent gathered on Sunday that
a significant number of the independent marketers, who got import
allocations from the PPPRA, were finding it difficult to finance them as
banks had refused to raise Letters of Credit for them.
Though the Federal Government still owes
the marketers substantial subsidy claims, many of those affected, who
are considered small, are said to lack the financial muscle to attract
more loans from the banks without paying what they currently owe.
“The marketers are facing financial
challenges because they are finding it difficult to finance their import
allocations. The supply situation may not improve until the middle of
April; and if care is not taken, it may last
till the end of April,” an
industry source, who asked not to be named, said.
The country’s daily petrol consumption
currently stands at 35 million litres, but since fuel scarcity began
last month, the market has been under supplied. As such, there has been
cyclical shortage as the supply has failed to meet the demand.
The Executive Secretary, Major Oil
Marketers Association of Nigeria, Mr. Obafemi Olawore, who spoke with
our correspondent on Sunday, said it was true that the Federal
Government owed the marketers huge subsidy claims.
“For us as majors, it is not totally true
that we are facing financial constraints towards importing petroleum
products, but for some smaller marketers, this may be true and that is
why it is important for the government to pay subsidy claims as and when
due,” he said.
Already, fuel depots have increased the ex-depot price of Premium Motor Spirit (petrol) from N87.70k per litre to over N100.
Our correspondent, who monitored the
situation in Lagos over the weekend, found out that petrol, which the
marketers normally buy for N87.70k per litre, was being sold for over
N100 across different depots.
Specifically, a litre of petrol was on Friday sold for N103 at the Nigerian National Petroleum Corporation’s Ejigbo depot.
NIPCO, an indigenous downstream player,
before its closure last week, loaded a litre of petrol at N95, about
N7.30k higher than the ex-depot price.
An industry source, who spoke under the
condition of anonymity, said the market remained grossly under-supplied
and that the marketers were taking undue advantage of the situation.
“The supply is not meeting the demand and
marketers are struggling with meeting the supply. Some depots are
selling for as much as N99.90k,” the source said.
Consequently, marketers have also increased the pump price of petrol from N97 to between N110 and N120 per litre.
The Chairman, Nigerian Union of Petroleum
and Natural Gas Workers, Western Zone, Mr. Tokunbo Korodo, said the
increase in the pump price of petrol was because the product was not
being made available to the marketers.
He said, “Some of the marketers are now patronising black marketers who sell above the pump price.
“The few ones selling at the pump price
have seriously adjusted their pumps by selling lesser quantity that does
not correspond to the money the masses are paying just to avoid closure
of the stations by the DPR.”
A litre of fuel was sold at N100 at the
MRS filling station located at the Ojodu Berger axis of the Lagos-Ibadan
Expressway on Friday. Magix X, a filling station adjacent to the
Excellence Hotel, Ogba, Lagos, charged extra N100 for every 10 litres of
petrol purchased by customers on Saturday.
A marketer, who runs a filling station very close to the NNPC Ejigbo depot, sold a litre of petrol for N110 on Saturday.
He explained that the price had increased
across the retail outlets because marketers were procuring the product
at a higher cost.
For instance, the marketer said he loaded
petrol at the Ejigbo depot at N103 per litre; paid N2 to transport it
to his outlet and added another N5 margin, thereby selling the product
at N110 per litre to the consumers.
A senior official in one of the private
depots said loading expenses and union dues were also adding up to the
already hiked ex-depot price of petrol, thus making the product more
expensive for motorists and other consumers.
The source also warned that customers
could not be sure of the quality and quantity of the product wherever it
was being sold for N97 per litre.
The Managing Director, Pipeline and
Products Marketing Company, Mr. Haruna Momoh, who responded to an SMS
enquiry by our correspondent, said, “The NNPC ex-depot price for the PMS
is N87.66k. This price is uniform in all the NNPC depots nationwide.
Your assertion is, therefore, wrong and, indeed, misleading in all
material particular. To say that the NNPC Ejigbo depot loaded on Friday
at N103 is a figment of somebody’s imagination, a congenital and
pathological lie.
“Our ex-depot price must not be confused
with the price at which unscrupulous elements or marketers sell the PMS
at the tarmac outside of our depot, after buying from the NNPC at the
official price.
“You may wish to ask the PPPRA, DPR,
MOMAN and IPMAN. All the NNPC retail stations sell at the official
price, just like our depots do.”
Olawore blamed supply shortage as being responsible for the current price hike and product hoarding in the country.
“If the supply goes round, nobody will
hoard petroleum products and nobody will sell above the pump price. No
major marketer’s station should sell above N97. Anybody doing that is on
his own,” he said.
He also blamed the delayed release of the
import allocation for the first quarter of 2014 by the PPPRA as the
remote cause of the ongoing fuel scarcity in the country.
Olawore said, “The allocation was
released three weeks ago. When you get an import allocation, it will
take at least between 24 and 48 hours before you get an import licence
from the Department of Petroleum Resources. It is when you get this that
you go to the bank to get the LC. It is when you get the LC that you
will be sure that your supplier will give you the product.
“If your supplier is in Europe, he will
need at least 14 days to sail from Europe to Nigeria. That is why we
always say that import allocation should be released on time.”