Review… Fuel scarcity: A recurring snag defying remedies

Despite assurances by stakeholders in the downstream sector of the petroleum sub-sector of an end to recurring fuel scarcity situation in the country, this is yet to abate as Nigerians are worried due to the biting hardship the situation creates anytime it rears its ugly head.

In the last few days, the premium motor spirit (PMS) has not only gone scarce but is selling at ridiculously exorbitant rates from between N200 and N500 per litre, depending on the part of the country.

According to price survey conducted by the marketers at depots in Apapa, Lagos, made available to Ripples Nigeria, the average price per litre of PMS was N112 as against the normal price of N77.66 per litre. The MRS depot sold at N110 per litre, Honeywell sold at N111, while Folawiyo and Capital Oil and Gas sold N115 per litre respectively, reflecting an increase of about 50 percent.

Shylocks have a field day

When Ripples Nigeria visited Apapa axis of Lagos, where majority of the oil majors are housed, the place was a bedlam of sorts, as fuel tanker drivers literally engaged in horse trading in their desperation to get products.

Most of the gates leading to the depots were swarmed with crowd all seeking attendance of the depots managers having kept vigil for weeks without getting products.

One of the marketers who spoke with Ripples Nigeria in confidence revealed that majority of the marketers had been unable to import fuel due to paucity of funds.

According to the marketer, so far, demand far outstrips supply just as a lot of unscrupulous individuals have cashed in on the situation to fleece hapless Nigerians.

It was gathered that though the Nigerian National Petroleum Corporation (NNPC) still sells at the regulated price of N77.66 per litre, but as soon as the loaded truck comes out of the gate, the products are sold to the waiting tanker drivers and marketers at ridiculously exorbitant rates on cash and carry basis.

According to him, it is only the NNPC that currently imports and it lacks capacity to distribute or even meet 50 per cent daily national consumption it claims to possess.

The turnaround time of the vessels that bring in NNPC fuel is very slow.  Unlike marketers that use three days to discharge their vessels, each of the NNPC’s vessels last over one week to discharge, putting pressure on demand. The timeframe between the discharge of one vessel and another is long.

Blame game

Understandably, the Group General Manager, Group Public Affairs Division of NNPC, Ohi Alegbe has said the marketers are being economical with the truth because of the subsidy money owed them, adding, that there is enough to go round if the marketers sincerely distribute it.

He said the Corporation recently decided to be publishing its daily fuel supply from the depots, the quantities given to marketers and the trucks that took the products, to confirm transparency and commitment of the government to provide fuel for the populace. Some marketers, he noted, want to discredit the government by diverting and hoarding the fuel given to them.

He said the Minister of State for Petroleum Resources, Dr. Ibe Kachikwu had a meeting on Wednesday last week with members of the Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association (DAPPMA) and the Jetty and Petroleum Tank Farm Owners of Nigeria (JEPTFON), and NIPCO to find ways to bringing the fuel scarcity to an end, and they pledged their support.

He stated that the Minister assured them that the subsidy debt would soon be paid because President Muhammadu Buhari has sent a letter to members of the National Assembly regarding the matter.

On their parts, the Executive Secretary of MOMAN, Obafemi Olawore, Chairman of DAPPMA, Dapo Abiodun, and Chairman of JEPTFON, Chief Ifeanyi Ubah said their members would work with the Petroleum Ministry and the NNPC to restore normalcy to fuel supply. They called on the government for assistance in clearing the heavy traffic at the Apapa loading gantries.

But a week after the meeting, the supply situation went from bad to worse. In Lagos State and environs PMS sells at between N110 and N120 per litre, in some parts of Ogun State, it is N130 a litre, in Asaba, Delta State, it is N150 a litre, in Anambra and Enugu States, it is N150 a litre but in Nsukka, Enugu State, it is between N170 and N200 a litre, in Abuja and some parts of the north, it is currently N250 per litre.

Ohi said the marketers will be paid their money next week or within the first week of December.

The NNPC has trucked out over 250 million litres of petrol between November 14 and 23 as shown by the Corporation’s truck-out and distribution data.

Read also: We’re not to blame for fuel scarcity-NNPC

However, stakeholders in the downstream sector in a position paper released after OTL Africa Downstream week held in Lagos, and signed by Mr. Reginald Stanley, Chairman Advisory Board, OTL Africa and former Executive Secretary PPPRA, and Mr. Emeka Akabogu, Chairman OTL Africa, said deregulation is the solution to the woes of the downstream.

They said: “Petroleum products subsidy is a disincentive to supply chain infrastructure investment, market innovation and consumer value. In view of current realities of low crude oil price and devalued naira, the country can no longer afford the burden of subsidies. The government is strongly advised to remove all petroleum products subsidies as a matter of immediate urgency and fully deregulate the downstream petroleum industry.

“Deregulation of the industry will attract appropriate investments, promote optimal efficiency, healthy competition, ensure efficient supply of petroleum products to the country and improve the infrastructures in the downstream sector.

“Local refining of petroleum products should be prioritised by the country and a deliberate shift initiated from importing products to building refineries. There is a need for a National Refining Policy which defines the framework for encouraging investment in petroleum refining in Nigeria to facilitate increased national revenue and infrastructure development.”

NUPENG’s recipe against fuel scarcity

In the view of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG) one better way to end the menace of fuel scarcity is for the federal government to fix the four refineries in the country.

National President of the union, Igwe Achese gave this assurance during an interview in a monitored television magazine programe in Lagos.

“I have said clearly over some months that the scarcity we are experiencing today will continue because we have mortgaged the petroleum product distribution marketing system into private homes, individuals in the name of privatisation,” he said.

Pressed further, he said: “What we need to do is one; put our refineries in other. And I ask myself how much that will cost us to carry out complete turnaround maintenance. Turnaround maintenance is between three to four months and you are aware that this turnaround maintenance has been an issue for the past 15 years. And every year we keep hearing we have spent so much billions in turnaround maintenance and yet we are nowhere. Two is to make sure that our pipelines are also being protected, very well secured and to make sure that petroleum products or crude oil are being haulage through these pipelines to the refineries.

“And then we need to tackle illegal bunkering. Government should sit up in fighting illegal bunkering. I ask myself, ‘the vessels that are being used to carry or lift up this crude oil, are they being charmed that cannot be seen by the eyes? These are big vessels that are visible and can be seen.”

As the blame game continues, and the experts proffer what they feel is the right way to go, Nigerians continue to suffer the brunt of the recurring scarcity of fuel product, while business groan under the weight of the consequences  of fuel scarcity, waiting for the promised change.

#Whatdoyouthink: What do you think government can do, to end the issue of fuel scarcity once and for all?

 

 
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