Fuel Scarcity Looms in Nigeria As Transporters Baulk At Rising Operational Costs

Nigeria could face a harsher economic climate as members of the Nigerian Association of Road Transport Owners (NARTO) on Thursday threatened to suspend operations on Monday due to rising operational costs.

National President of the organisation, Alhaji Yusuf Othman, in a press statement in Abuja, noted that if no deal is reached before then, members will park their trucks as from that day.

He lamented that the members of the association have been operating at a loss, stressing that it is no longer sustainable for them to endure the losses.

“What we spend on operation is more than what we get in total: both in local and bridging. We will have to suspend operations latest from now till on Monday.

“We cannot continue to operate at a loss. Most people have parked. A lot more are going to park. But from the point of the association itself, we are going to suspend operations on Monday,” Othman stated.

The NARTO president disclosed that the association’s efforts at soliciting the intervention of all the key stakeholders in the federal government and industry  have not yielded positive results.

He revealed that the association had written letters to table their plights to several government agencies and officials that should intervene.

He listed them as: The Chief of Staff to President Bola Tinubu; Minister of Petroleum Resources; Director General, Department of State Services (DSS) and the Nigerian Midstream and Downstream Regulatory Authority (NMDPRA) Chief Executive Officer.

Othman further stated that the association wrote to the National Petroleum Company Limited (NNPCL) Group Chief Executive Officer as well as relevant product marketers.

He stressed that despite the notification to the above stakeholders, there had been no response from any quarters.

He recalled that the same freight rate that was in force while President Muhammadu Buhari was in government is still subsisting, despite the shift in economic realities.

According to him, the N32 Lagos to Abuja freight rate that was implemented while the dollar was N650 is still retained now that the dollar is N1,615.

 “Everybody is aware that all our consumables in terms of operation are not produced in the country. So, by virtue of the rate of dollars, every consumables has increased. But the freight they are paying us has been the same even during Buhari’s time.

“So how is that feasible? During Buhari’s time, dollar was N650. Today, dollar is  N1,615. The average freight from Lagos to Abuja is N32.  What I mean by local is that you load Lagos, you discharge in Lagos. And bridging, you load from Lagos, you come to Abuja. Lagos to Lagos, we are paid N120,000.

“AGO (diesel) alone to distribute fuel within Lagos is N140,000 because it is N1,400 per litre. So, they give you N120,000 and you spend N140,000. So, how do you want to operate talk more of cost of vehicles, cost of loading, driver’s allowance. That is for local. For bridging, Lagos to Abuja, they give us N32.

“If you have truck of 40,000 litres, you are talking of N1,280,000-N1,216,000, less 5 percent of the amount of N1,280,000 withholding tax N64,000, less N55,000 loading expenses and N15,000 driver allowance. Total expenses is N134,000, while balance is N1,146,000. AGO is N1400 for 900 litres, totalling N1260,000. There is a total loss of N114,000,” he lamented.

The diesel expended from Lagos to Abuja, he said, is 900 litres. “So when you use 900 litres at N1,400, that will be N1,260,000. So it is by far more than what are paid.

“Meanwhile the cost of a new truck head and tank is N95 million and used is N50 million. So, imagine the amount invested in each truck?” he said.

Emmanuel Addeh

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