Fuel scarcity looms as depots raise petrol price to N720/litre
Fuel scarcity is gradually surfacing in Lagos and other parts of the country as private depot owners hiked the ex-depot price of petrol from N630 to N720 per litre.
This came as fuel scarcity deepened in Abuja and the adjoining states on Sunday with some filling stations dispensing PMS as high as N900/litre.
Our correspondents report that a number of filling stations in Lagos, Ogun and some states have run out of stock as they refused to buy high-priced fuel from the private depots.
Speaking in an interview with one of our correspondents on Sunday, the National Vice President of the Independent Petroleum Marketers Association of Nigeria, Hammed Fashola, said many filling stations did not open for business because they had no fuel in their tanks.
He said the Nigerian National Petroleum Company Limited, which is the sole importer of petrol at the moment, should explain to Nigerians what was happening with the product.
READ ALSO :Peter Obi reacts to Dangote’s remark on CBN’s interest rate
“Those that shut their stations do not have fuel to sell. When you don’t have fuel, you cannot open your station. That is the problem. You know the NNPC is the sole importer of this product. I think it is in the best position to tell us what is actually going on.
“Currently, independent marketers cannot buy what the private depots are selling. They are selling fuel between N715 and N720 per litre. How much will marketers sell the product? Look at the cost of bringing it to their depots; with transportation and other depot expenses, it will be too costly for them. That is why the stations are shut down. Some marketers refuse to go and buy because they know the masses cannot afford high-priced petrol in this economy. That is the situation for now,” the IPMAN leader stated.
Our correspondents learnt that the third parties, who are private depot owners, used to sell PMS to independent marketers at the rate of N630-650/litre before now, while the NNPC sells petrol to major marketers at a price below or around N600.
On many occasions, leaders of IPMAN have appealed to the NNPC to supply them with petrol directly like they do to major marketers, but the NNPC has yet to yield to that call.
Fashola appealed to Nigerians to avoid panic buying, saying they should buy what they need so that the fuel in circulation could go round.
It was gathered that the major marketers sold petrol below N650 while the independent marketers sold between N750/litre and N800 /litre.
READ ALSO : Nigeria’s image Continues to dwindle, Peter Obi Points out As Harvard Business School omits Nigeria
Multiple officials confirmed to one of our correspondents that officials of the Nigerian National Petroleum Company Limited stormed the various depots in Apapa on Friday, mandating depot owners to prioritise fuel supply to the Federal Capital Territory, Abuja, where the fuel queues were initially noticed on Friday.
Abuja prioritised
On Saturday and Sunday, many trucks were reportedly directed to Abuja to reduce the queues in the FCT, leaving Lagos and other places with little supply.
One of the officials disclosed that the NNPC was rationing PMS to depots due to the fuel supply gap.
This is coming barely three days after a report by Reuters claimed that Nigeria’s debt to suppliers of Premium Motor Spirit had surpassed $6bn, doubling what it was since early April, as the NNPC struggled to cover the gap between fixed pump prices and international fuel costs.
Although this was denied by the NNPC, the Reuters report stated that the national oil company began struggling early this year when late PMS payments surpassed $3bn.
The company, it said, had yet to pay for some January imports which traders put between $4bn and $5bn.
“The only reason traders are putting up with it is the $250,000 a month (per cargo) for late payment compensation,” one industry source said.
At least two suppliers were said to have stopped participating in recent tenders after hitting self-imposed debt exposure limits to Nigeria, meaning they will not send more PMS until they receive payments.
READ ALSO :Implementing four National Budgets concurrently is a recipe for Disaster – Peter Obi chides FG
It was reported that Nigeria’s tenders to buy gasoline in June and July were smaller, traders told Reuters. NNPC will import via tender about 850,000 tonnes in July, according to the Reuters report quoting sources, down from the typical one million tonnes in previous months.
Meanwhile, PUNCH findings show some marketers have refused to supply petrol to independent marketers, who own the larger percentage of the filling stations in Nigeria. This, it was gathered, was because the depots/marketers were getting limited supplies from the NNPC.
“Currently, we focus on our filling stations. We get less than 50 per cent of what we usually get from the NNPC now. So, we make sure we feed our stations first before we consider selling to independent marketers. That is why most of them are out of stock. You know they don’t have access to the NNPC and the little we get is not even enough for our stations,” one of the depot operators told The PUNCH on condition of anonymity because was not authorised to speak on the matter.
The operator mentioned that the few depots selling to IPMAN members sell at higher prices as demand overshoots supply.
Sokoto
Long queues of motorists resurfaced at the mega station of the NNPC in Sokoto State as fuel scarcity hit the state. Our correspondent who monitored the development gathered that only the NNPC station sold the product at N620 naira per litre.
Other fuel stations that sold fuel between N720 and N750 before now sell between N850 and N900, depending on the filling stations.
In Kaduna, fuel is sold between N720 and N800 along the Sabon-Tasha expressway by Command Junction, in the southern part of the state.
At the NNPC Mega stations along Stadium Roundabout and Aliyu Makama Road by Living Faith Church, Barnawa, fuel was being sold at N620 per litre but with a long queue.
At the black-market rate, motorists buy a gallon of petrol at N4,000 and N4,500 depending on the locations within the Kaduna metropolis and its environs.
NNPC spokesperson did not immediately respond to calls and messages seeking reaction on the developments on Sunday
Abuja scarcity lingers
Meanwhile, some filling stations in locations far from the city centre of the FCT dispensed Premium Motor Spirit, popularly called petrol, at N900/litre on Sunday, as the scarcity of the commodity lingered in Abuja and neighbouring Nasarawa and Niger states.
Hide original message
Hundreds of motorists besieged the outlets operated by big dealers such as Nipco, Salbas, and Conoil, among others, to get the product at between N660/litre to N690/litre, whereas smaller stations operated by independent marketers sold the product at higher rates.
One of the remote stations along the Kubwa Village market road dispensed its product at N900/litre and had fewer queues compared to those at the few outlets of major dealers that sold petrol on Sunday.
Attendants at the Kubwa facility confirmed the position that was earlier stated by the National President of the Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi, that the ex-depot price of petrol had been increased to N710/litre at depots.
“The price of petrol at depots is now more than N710/litre. You have to pay for transportation to bring it from Lagos, Port Harcourt or Warri to Abuja, That cost has to be factored in. There are other operational costs to include too.
“When you add all this, there is no way you will sell at even N800/litre and be able to get a sensible margin. This applies mainly to independent marketers who operate smaller stations.
“For the major marketers, some of them have their private depots, so they can afford to sell at lower prices,” an attendant who simply identified himself as Austin, stated.
The IPMAN president had earlier told our correspondent that some dealers closed their retail outlets due to their inability to access petrol as a result of the hike in the ex-depot price of the commodity to N710/litre by private depot owners.
He said private depot owners had raised the ex-depot price of PMS to N710/litre, whereas the pump price of the commodity at NNPC retail stations was N617/litre.
Maigandi said, “The current situation is a result of the way private depot owners have been selling their products. It has been very difficult for independent petroleum marketers to get the product and sell it in Abuja and neighbouring states, as well as in other states in the North.
“So the queues you are seeing now are because of the cost of PMS by private depots. The private depots are selling at N710/litre, but if you check the price of the same product at NNPC retail outlets, it is N617/litre.
“Therefore, by the time we independent marketers buy from private depots and bring it to our filling stations, we will not be able to sell our product because our cost price is already so high, while the cost at NNPC retail outlets is far lower.
“And you know that when we buy it at the rate of N710/litre we have to add transportation cost again because there is no equalisation. And when we add the cost of transportation, the pump price is going to be higher than the N710/litre ex-depot price, whereas NNPC stations sell at N617/litre.”
Maigandi explained that because of the widespread number of stations operated by IPMAN, any distortion in the supply of products to members of the group would eventually lead to fuel queues because major marketers and NNPC stations are fewer in number.
READ ALSO : Inflation rate hits 33.95% as NBS confirms rising prices of garri, beans, other foodstuffs
On whether IPMAN members cannot get direct PMS supply from NNPC, instead of buying the product from private depots, he replied, “That is what we have been negotiating with them (NNPC), and they promised us that they will start giving us our allocation.
“They have started but the quantity is small compared to the number of retail outlets operated by IPMAN nationwide. We are getting products from NNPC, but the volume is too small for our members.
“So we are requesting additional volumes because in Abuja alone we have over 250 retail outlets belonging to IPMAN members. This is just for Abuja, we’ve not talked about Niger, Kaduna, and other states in the North, not to talk of the number nationwide.”
Maigandi, however, stated that the queues for petrol were not pronounced in remote villages, adding that “when you go to the villages you will see that there are no queues.”
– heritageReporters
In all of these… Federal Government is still denying of Subsidy payment…. 😂 Hahhhahaaaaaa…… Chai… What a country, what a government… There is always an end to everything…. Let’s keep watching keenly!!!!