Major filling stations in Lagos, Ogun states and other parts of the country, now dispense Premium Motor Spirit (PMS), also known as petrol, for N280 per litre, as available evidence suggests that the price is likely to increase to as high as N300 per litre, in just a few weeks to Christmas and New Year festive period, due to some unresolved supply issues and lack of governance.
The situation has therefore forced motorists and residents of the states to spend hours at filling stations during the weekend and early hours of Monday morning to get the product, even at discriminative prices.
The crisis has however paved the way for black marketers to sell a litre of fuel at N400 or N500 per litre, depending on locations and availability, especially in stations where the products are hoarded.
Another major phenomenon that is now a trend is alleged rationing and hoarding of the products among some petroleum products marketers who are now operating like cartels determining when to sell, at what price and who gets what.
EnergyDay’s correspondents who went around the major locations in Lagos and Ogun state reported that the fuel scarcity was noticeable in filling stations owned by Independent Petroleum Marketers Association of Nigeria (IPMAN) members most of whom constitute the majority of petrol stations in the state.
According to investigations, the Major Oil Marketers Association of Nigeria (MOMAN) and Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) are deliberately selling products to independent marketers at unofficial prices, creating a supply shortfall resulting in scarcity across the country.
Stations owned by MOMAN including Mobil, Total, Ardova and others were selling petrol at N170, but recorded long queues, disrupting traffic flow on major highways in Lagos.
Some of these stations that are predominantly in Lagos Island and Lekki Ajah axis recorded long queues of motorists, while some shut their gates against customers due to product unavailability.
However, the situation was terrible in the mainland part of the state as filling stations in some of the cities and suburbs were shut down.
Filling stations across the including those in Ikeja, Abule Egba, Ayobo, Agege, Alimosho, and Ojodu all in Lagos, were selling petrol within the range of N200 and N280 per litre.
Most of them claimed that their tankers have spent days at the depots in Apapa, Satellite town, Lagos and other parts of the country without being loaded.
This has further escalated into another crisis, leaving commuters stranded at bus stops, even on Monday morning, due to an over 200 per cent increase in transport fares.
A concerned oil marketer who preferred to be anonymous attributed the crisis to a lack of governance and seeming unregulated downstream and midstream regulations, adding that the Nigerian Midstream and Downstream Petroleum Regulatory Authority(NMDPRA) has been struggling to perform its statutory role of regulating the activities of the major marketers who now enjoys the liberty to sell petrol at any rate above regulated price unrestrained.
According to him, MOMAN receives a supply of the products directly from the Nigerian National Petroleum Corporation Limited(NNPCL) at the approved price per litre and refuses to sell to independent marketers at the official prices.
He said, “NNPC released petrol at N148 per litre, to the major off-takers and terminal owners but these marketers sell to private depot owners above the above N165 per litre. He confirmed that the ex-depot price from the depots is N195 to N210 per litre.
“DAPMAN who are the private depot owners, blamed the rising ex-depot price on the cost of transportation from the mother vessel to their private depots due to the foreign exchange crisis, claiming that they got the US Dollars at the black-market rate.
SITUATION AT NNPC RETAIL STATIONS
Our correspondent who visited most of the retail stations in Lagos state revealed that Nigerian National Petroleum Company Limited (NNPC) retail stations are selling for N168 per litre above the official price of N165 – the sole importer of petrol – including the newly acquired Oando/OVH outlets.
At the two NNPC filling stations at the Jibowu axis, dispensing to motorists was seen at N168 per litre.
The situation was the same at the NNPC Mega station, at Alfred Rewane Road Ikoyi Club Road, and NNPC Mega station Ikosi Ketu, recording long queues of motorists.
Motorist Olakunle Ajibade in a chat with our correspondent revealed that NNPC Ltd. has also joined the marketers to rip Nigerians off by selling above official prices. He however challenged the NMDPRA to enforce compliance with regulated price, since the country is already paying subsidy on the petrol
NMDPRA AND INDUSTRY REGULATION
Further investigations revealed that due to a lack of governance and proper regulations the midstream and downstream sectors have been left to the whims and caprices of petroleum products marketers who simply choose when to sell at will.
Mr Farouk Ahmed, Authority Chief Executive, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) despite assurances that there was enough stock of petrol to last the country throughout the festive period and the availability of 2.1 billion litres of petrol was in stock has failed to call the marketers to order on the widespread hoarding of the products.
The Major Oil Marketers Association of Nigeria (MOMAN) in a statement released at the weekend claimed that it is working with the Nigeria National Petroleum Company (NNPC) Ltd., to improve the distribution of petrol across the country.
Mr Clement Isong, Chief Executive Officer of MOMAN, in response to the scarcity told the News Agency of Nigeria (NAN), that the association had been holding a daily logistic emergency meeting with the downstream management of NNPCL on how to improve the supply of petrol.
According to him, the collaboration with NNPCL will enhance the distribution of petroleum products in the country.
“We are doing depot-to-depot check-in and check-out to enhance efficiency, and also have logistic supply meetings with NNPCL.
“There is also collaboration among our members to cushion supply to various MOMAN’s stations.
“We arranged it in a way that any MOMAN member who does not have product can pick from fellow members’ depot to minimise supply gaps,” he said.
Isong also said the effort was to improve the supply of petrol at filling stations across the country.
“NNPCL had an operational meeting with MOMAN to ensure that products are effectively distributed across the country.
“The logistics meeting was to ensure adequate distribution of products to stations across the country,” he added.
The helmsman said MOMAN members would be working late and during the weekend to bridge product supply gaps.
He said MOMAN had been pushing out more products than it normally did.
He added that the scarcity was a result of delays experienced at the point of receiving products from offshore to onshore at the port.
He, however, said the logistics challenge had been resolved and members were currently trucking out products.
However, the oil marketers and petroleum depot operators, under the aegis of the Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), called for quick intervention by the Federal Government.
Its Chairman, Mrs Winifred Akpani, urged the Nigerian Maritime Administration and Safety Agency (NIMASA) and the Nigerian Ports Authority (NPA) to comply with the Federal Government’s directive to end payment of port charges in dollars for petroleum products brought into the country.
Akpani maintained that accessing forex through the Central Bank of Nigeria (CBN) window would enhance their capacity, facilitate a seamless supply of petrol, and birth a regime of sustainability in terms of storage, distribution and supply across the nation.
“DAPPMAN hereby calls on the government to establish a level playing field in the sector by giving petroleum marketers access to forex at the CBN exchange rate for their operations,” said Akpani.
He emphasised that accessing FX at the official rate would boost fuel supply across the country.
She added that the burden of sourcing forex through the parallel market for transactions domiciled in Nigeria had left petroleum marketers in dire straits.
She said, “Accessing dollars for our operations has been an insurmountable hurdle for petroleum marketers.
“The difference between CBN exchange rate and the parallel market exchange rate continues to get wider by the day,” the DAPPMAN boss said.
Chief Ukadike Chinedu, National Public Relations Officer of the Independent Petroleum Marketers Association of Nigeria(IPMAN) attributed the scarcity to the availability of foreign exchange to off-takers and marketers. .
He said, “There was a time you interviewed me some months ago, and I told you that fuel would sell for N200 per litre. You were really not comfortable with that statement.
“After that publication, many stakeholders called you to react to it. Some of them also called me to say why did I say fuel would be sold at that price? But I was only discussing based on the indices of the industry at that time.
“As a PRO of IPMAN in Nigeria, I can read the policies of the government towards the distribution of products in the downstream oil sector. You look at the exchange rate of the dollar to the naira, some foreign interruptions and the price of diesel.
“All these are factors that definitely affect petroleum products’ prices since we are not producing refined products in Nigeria. We cannot sustain the importation of petrol.
“Otherwise, we will continue to see ghost queues every month and this may continue till the end of this year. The major solution now is to speed up the repairs of our refineries. However, we are meeting and looking for quick interventions,” the IPMAN’s spokesperson said.