Make Sense of the current fuel scarcity in Nigeria

Going by the current downward trend in the price of crude oil, one will think that crude oil products including petrol will follow suit,but that is not the case in Nigeria. The existing refineries in Nigeria has not been able to cope with the local demand. These refineries are not even operating  up to 50% capacity. Nigerians have been left with no choice than to buy from marketers who import their products at dollar rate.

Amidst other economic challenges, many are beginning to question President Buhari’s mantra of change as the country experiences the fifth fuel scarcity in just eight months. Here is what you need to know about the current fuel scarcity:

The scarcity has been attributed to scarcity of forex and NNPC being the sole importer of the product

The scarcity of foreign exchange has also impeded the efforts of major marketers to import petroleum products as expected. Of the five major marketers, only Mobil Oil and Total have been able to import petroleum products because of their foreign affiliations. Other major oil marketers find it difficult to source for the dollar at over N300 to $1, to import petroleum products, leading to an imbalance in the expected products to be distributed across the nation.

According to the Petroleum Tankers Drivers (PTD) National Chairman, Comrade Salimon Akanni Oladiti, “the situation has been fragile since the NNPC assumed the role of the sole importer of petrol. There is a supply gap…now, since the NNPC imports 78 percent of the petrol needs of the country, with other marketers sharing the remaining 22 percent.”

Varied pump price

Long queues and a hike in the pump price returned over the weekend across filling stations in the country. Most filling station now sell above the official pump price of N86.50k. In Lagos, the pump price ranged from N100-N150 per litre with additional amounts for residents coming to the filling station with jerry cans while in Ibadan, the price of petrol ranged between N110 and N120 per litre.

NNPC plans to nip fuel scarcity in the bud.

In a statement by NNPC Group General Manager, Group Public Affairs Division, Mr Ohi Alegbe, the corporation said it took delivery of four more cargoes of premium motor spirit (petrol) to keep the flow of the supply chain. The deliveries of about 180 million litres of petrol are part of a new arrangement by the corporation to have a cargo of PMS delivered daily from next month.

The Group Managing Director of the Nigerian National Petroleum Corporation, Dr. Emmanuel Ibe Kachikwu, further affirmed NNPC’s commitment to monitor pump price across the federation as sanctions would be placed on depot owners found guilty selling above the approved ex-depot price of N77.(venturesafrica.com)