Fuel scarcity: FG runs out of ideas

Nigerians may have to live with the ongoing fuel scarcity until after May 29 following the inability of President Goodluck Jonathan to end the shortage, which first began about three months ago. The scarcity has defied solutions, despite several meetings and promises by the Ministry of Finance, the Nigerian National Petroleum Corporation (NNPC),
Department of Petroleum Resources (DPR), Pipelines and Product Marketing Company (PPMC) and oil marketers to improve on the supply system. New Telegraph investigations showed that the president might have decided to leave the matter to the incoming administration of Major General Muhammadu Buhari instead of tackling the crisis, which has crippled socio-economic activities nationwide. Oil marketers, it was learnt, had cut down on fuel importation out of the fear that the Buhari administration might not honour debt obligation arising from the fuel subsidy scheme. They are now waiting for a pronouncement on subsidy from Buhari to end the fuel scarcity rocking Nigeria. Nigeria, Africa’s biggest crude exporter, depends largely on importation of refined products due to inefficiency of its four refineries to meet the 40 million litres daily consumption requirement. Added to this is the halt of importation by private concerns, which have thrown the country into a major fuel crisis that is expected to continue even after the President-elect assumes office. Nigeria is now at the mercy of Niger Republic, which is now supplying about two million litres to the Northern region. A Niger Republic official, who is on vacation in the United States, told New Telegraph that the Soraz Refinery in Niger was catching in on the scarcity in Nigeria. Importers who have stopped fuel importation have said only a “pronouncement and assurance” from Buhari can make them begin importation. The Federal Government, through the Coordinating Minister for the Economy and Minister of Finance, Dr. Ngozi Okonjo- Iweala, had called on the marketers to resume imports after a part-payment of about N165 billion was made to them. But the Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN), Thomas Olawore, said the government, which has made them go insolvent, was not in the best position to ask them to import. He said: “Our operations are facing a serious threat owing to the debts the government owes us and the banks are still not helping matters. They have stopped to honour our requests for loan facilities. Now, tell me, what do you do in this kind of situation?” It was gathered that the importers were more confused with the stance of the President-elect on payment of subsidy and many of them believed that it would make no economic sense for them to import on credit for a period, which will not be controlled by the outgoing government. “We are afraid of going ahead to import because we are neither sure that the next government will pay the backlog of subsidy nor honour a new fuel import contracts,” a management staff of one of the major marketing firms told New Telegraph on the telephone. Meanwhile, Niger Republic is catching in on the fuel scarcity in Nigeria to boost sales and the country exports of about two million litres of fuel to its neighbour. A Niger Republic official said his country had a huge surplus of product refined from about 13, 000 barrels per day and the larger chunk of Premium Motor Spirit (PMS) from this volume is consumed majorly in Nigeria. He said: “Although the optimum capacity is 20, 000 barrels per day, the Soraz Refinery is refining average of 18, 000 barrels of crude daily. Our domestic requirement from this is less than 5, 000 bpd and you should know that the scarcity in Nigeria is a major market advantage for our products,” he said. The oil installation is close to the Nigerian border. T he 20,000 barrels per day (bpd) Soraz Refinery, located in Niger Republic, is now a major supplier of petroleum products to Katsina, Bauchi, Sokoto, and Jigawa, amongst others. These states actually consume petroleum products from the refinery located at Zinder, some 900 kilometres east of the capital of Niger, Niamey. As the fuel crisis worsens, the Republic of Benin and other neighbouring countries have begun to suffer the backlash. “Towns like Cotonou, Tube, Ajashe and others in Benin Republic have, for a long time, been depending on supplies from Nigeria through Idiroko border and now that Nigeria is not able to even satisfy itself, these towns are in serious mess,” Ade Qudus, a tyre merchant in Owode-Yewa, border town between Nigeria and Benin told New Telegraph by phone. However, oil workers have called for a ceasefire between the government and oil importers. The workers, under the auspice of the Petroleum Tanker Drivers (PTD) arm of the National Union Petroleum and Natural Gas Workers (NUPENG), said the government and marketers should resolve their differences in the interest of Nigerians. President, NUPENG PTD, Lagos unit, Tokunbo Korodo said: “The major marketers and independent marketers are the ones that shut their depots from tanker drivers due to their subsidy outstanding. The queue in filling stations across the nation is because it is not all of them that have fuel. The only few that have need to cater for the entire nation. In fact, bridging is the in-thing now; tankers are coming from different parts of the country to Lagos to lift fuel.” The prevailing price of petrol at the international market is currently around N115 per litre, while it sells at N87 per litre in Nigeria, amounting to a subsidy of N28 per litre. This has compelled the independent oil marketers to sell the product at between N125- N135 per litre. The scarcity has continued to take a toll on business activities across the country. While queues have persisted in filling stations, which dispense in Lagos and Abuja, others who shut their gates against customers are selling to the black marketers at a price between N120 and N140 per litre. The black marketers in turn are reselling to motorists at between N160 to N250 per litre. The prolonged scarcity has also brought in its wake, a hike in transport fares, commodities and services.
By Newtelepraph