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Fuel Scarcity: Marketers Insist On Deregulation

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Fuel queue in Lagos

Fuel queue in Lagos

• Promises Products Availability Before Christmas

PETROLEUM marketers have assured Nigerians of ‘oily Christmas’, as they promised to join the Nigerian National Petroleum Corporation (NNPC) to flood the market with petroleum products before 25th of December. They gave the assurance on the condition that the subsidy re-imbursement from the government hits their account on time.

The promise came on the heels of the pledge by the government that this would be the last of fuel scarcity during Muhammadu Buhari’s administration.

One of the major oil marketers, who spoke with The Guardian, said fuel scarcity persisted because only the NNPC ‘is importing the essential commodity for now.”

“The government is the only importer of fuel now, and they keep telling us that they have supplied the commodity to the filling stations. If they claimed to have supplied 1.4 million litres and you cannot find it at filling stations, then somebody should ask the government the whereabouts of the fuel they supplied. We are not importing because government has not paid for what we supplied. But the National Assembly has approved our payment, even beyond the September request by the President. So we can now join the NNPC to ensure fuel is available during Christmas,” he said.

The marketer also called on government to deregulate the down stream sector of oil and gas, saying it is the only solution to the persistent and recurring fuel scarcity in the country.

“The government should deregulate the oil sector to attract investors. I am not talking about investors like Dangote, who is building a political refinery. I will call it so until the government is able to tell us how much it intends to sell the crude to Dangote refinery and until the refinery is able to sell petroleum products at N87 after completion and until it is able to export refined products from its free trade zone location.”

According to him, although the former government had the intention to deregulate the oil sector, human rights movement and labour groups prevented the moves, adding that under the current dispensation, “the only group of people that are gaining are the foreigners and their refineries that are creating jobs for their people.”

Fuel scarcity has persisted for about one month, making filling stations to dispense the product above the official price of N87 per litre.
But the NNPC condemned the hike, insisting it had pumped enough fuel into the system, even when the output from local refineries is abysmally low.
From January to October 2015, the three refineries produced 682,901 Metric Tones (5,007,030.13 bbls) of finished Petroleum Products out of 955,537 Metric Tones (7,005,997.28 bbls) of Crude, processed at an average capacity utilization of 5.18 per cent and yield efficiency of 78.93 per cent.
In October this year, NNPC said it supplied 852.10 million litres of white products into the country through the Off-shore Processing Agreement (OPA) arrangements, compared with a volume of 763.90 million litres achieved in September. DPK receipt in October, according to the corporation, was 206.46 million litres, compared with 196.30 million litres imported in September.

Figures from the NNPC indicated that a total of 676.70 million litres of white product was distributed and sold by PPMC in the month of October 2015, compared with 507.90 million litres in the prior month of September 2015. This is comprised of 645.79 million litres of PMS, 4.72 million litres of Kerosene and 26.16 million litres of Diesel.

Despite the claim of tangible supply of the commodity, scarcity continued unabated, which made the corporation to issue a statement, few days ago, to reassure Nigerians of the availability of the commodity.
The statement signed by the General Manager corporate affairs of the corporation, Mr. Ohi Alegbe said a projected volume of 1.4 billion litres of petrol was available for distribution to fuel stations across the country all through the month of November.

Quoting the Executive Director, Commercial, Pipeline and Products Marketing Company (PPMC) Mrs Justin Ezeala, Alegbe said the company had increased the volume of petrol being trucked out to fuel stations across major cities in the country, adding that most of the 37 NNPC Retail Mega Stations across the country have been directed to commence 24-hour service.

The NNPC had enlisted the service of the Directorate of State Service (DSS) and the EFCC to track the movement of the product supplied; an apparent frustration over the scarcity palaver.

From Agege and Ikorodu to Lagos, through Ketu and Surulere last Thursday, all filling stations had no fuel. The few ones that sold dispensed at unofficial prices of between N120 and N140 per litre. Only stations owned by major oil marketers sold at official price, but the long queue scared prospective buyers.

The Independent petroleum Marketers said if the product is available as claimed, the solution to the scarcity would be decentralisation of distribution.

National President of IPMAN, Lawson Obasi, said in Port Harcourt few days ago that spreading of petroleum products to other coastal depots across the country would end the current scarcity.

He said a situation where government only distributed petroleum products to tank farms in Lagos was partly responsible for current scarcity and high cost of product.

The Minister of Information and Culture, Alhaji Lai Mohammed, has however assured Nigerians that the current fuel scarcity will be over in a matter of days, following the approval of the subsidy payment by the National Assembly.


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