Nigeria: Petrol to Remain at N165 Per Litre, Says Regulator

Despite the position of some oil marketers that the current pump price for petrol in Nigeria is unsustainable following long queues that have surfaced in some cities across the country, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) on Tuesday maintained that the pump price for premium motor spirit (PMS) remains at N165 per litre.

This was just as the Nigerian National Petroleum Corporation (NNPC) Tuesday assured Nigerians that it has over two billion litres of PMS that would last for the next 34 days in the country, adding that there was enough stock to meet the nation’s demand.

However, oil marketers under the aegis of Depot and Petroleum Products Marketers’ Association of Nigeria (DAPPMAN) have empathised with their customers and the members of the public on the current distribution hiccups witnessed in the supply of petrol from the various petrol stations dispensing at N165 per litre, saying the price was unsustainable.

But the House of Representatives has summoned stakeholders in the Nigerian downstream oil and gas sector to appear before it Wednesday over the resurgence of petrol scarcity and queues in some parts of the country as well as the soaring prices of diesel and Liquefied Petroleum Gas (LPG).

The statement by the NMDPRA that insisted on N165 per litre for pump price, came on the heels of the recent agitation by the Independent Petroleum Marketers Association of Nigeria (IPMAN) that PMS sold at N165 was no longer sustainable.

The Executive Director, Distribution Systems, Storage and Retailing Infrastructure, NMDPRA, Mr. Ogbugo Kalu, who spoke at a media briefing said the Authority was ever ready to enforce the price on independent marketers who are planning to increase pump price to N180 per litre.

“PMS is a regulated product. The price is fixed and the ex-depot price is known. The pump price remains at N165. So we continue to urge Nigerians to keep within these operating rules,” he explained.

According to him, in the next three days, the Authority would focus its energy in making sure that the marine stock would be translated into inland stock to get petroleum products across the country.

He added: “Within a very short while, we will see the fuel queues pale out. So that is what our focus in the Authority and for the next few days we urge every operator and indeed even assure the public that whatever glitches and supply gaps that have been observed will disappear shortly.

“So we do not encourage any panic buying. We urge Nigerians to be calm as these things will be resolved very easily.”

Meanwhile, the Group Executive Director, NNPC, Adeyemi Adetunji, said over two billion litres of PMS that would last for the next 34 days was in country, adding that there was enough stock to meet the nation’s demand. He assured that NNPC was working with the entire operators and stakeholders in the downstream sector to ensure that petroleum products get to distribution channels and filling stations across the country.

“With all the apparatuses put in place, we can assure that all the fuel queues will disappear in the next few days. Nigerians will continue to enjoy the free flow of petroleum products,” he added.

The Managing Director, Petroleum Pipeline Marketing Company (PPMC), Isiaku Abdullahi, said all hands were on the deck to support its marketers and transporters to ensure that petroleum products get to where they are needed.

He said there were about three vessels in the Apapa jetty waiting to offload more than 60 million metric tonnes, adding that in due course, the potential and imagined fuel crisis in Lagos would be over.

On his part, the Managing Director, NIPCO Plc, Suresh Kumar, said his company was receiving 18 million litres of the 90,000 metric tonnes waiting to be offloaded at the Apapa jetty.

“I am happy to announce that we have another 32 million to be received from the vessels which are coming. So, with that in picture, you know, the supply gap or the supply logistic challenges which was there has been addressed.

“So, the products are there with us, we can see that the trucks have started coming up. The Authority has given us the first approval to see that these products of about 30 to 40 million litres should be dispensed on a 24-hour basis,” he said.

“So, what I can categorically assure all Nigerians is that the product is there and it is going to flow into the trucks and they are going to move from here to the stations. So, they have to be rest assured they should not panic, panic is a problem, it will create high demand.

“So without panic and if this normal situation functions, then everybody should be getting product in the next couple of days,” he averred.

Depot Owners Lament Unsustainable N165 Per Litre Petrol Pump Price

However, DAPPMAN, in a statement issued Tuesday night, said the on-going Russian/Ukraine War had adversely affected the whole world, including the downstream oil and gas sector in Nigeria, impacting negatively on global and local fuel and food supply.

It said the international prices of these items had risen astronomically and had more than doubled their old rates since the beginning of the war, thereby causing extreme increases in local prices.

By extension, DAPPMAN said the local running costs of operating their various fuel depots had gone up astronomically, adding that the petrol they supply was sourced, solely from Nigerian National Petroleum Company (NNPC) Limited’s marketing subsidiary, Petroleum Products Marketing Company Limited (PPMC) for sale to the public at the regulated price of N165 per litre. It explained that this purchase was made by depot operators with funds sourced with high bank interest charges, alongside increased costs of hiring vessels, with which they deliver the fuel cargoes to their depots.

According to the statement, “These costs have doubled within the period of this Russian/Ukraine war.

Added to this is the scarcity of bunkers (ship’s fuel). We also experienced astronomical increases in the cost of diesel used to power equipment and machinery in our various depots and our retail outlets.

“Depot Owners and the government have continued to struggle over time to sustain supply of PMS at the current pump price of N165 per litre despite the huge subsidy cost to government and abysmal margins to the Depot owners.”

The marketers’ association observed that if not for its suspension, the implementation of the Petroleum Industry Act (PIA) 2021 would have provided an ideal enabling environment by creating the free market in which demand and supply would affect fuel pump price.

“We hereby assure the public that Depot Owners, working in concert with NNPC Limited, through its marketing subsidiary, will continue to work hard to ensure availability of products nationwide,” the statement added.

House Summons NNPC, NMDPRA, Marketers over Fuel Scarcity, Soaring Diesel, Gas Prices

The House of Representatives has summoned stakeholders in the Nigerian downstream oil and gas sector to appear before it on Wednesday over the resurgence of petrol scarcity and queues in some parts of the country and the galloping rise in the prices of diesel and Liquefied Petroleum Gas (LPG).

The lawmakers in a letter signed by the Chairman of the House of Representatives Joint Committee on Petroleum Resources (Downstream) Hon. Mahmud Gaya, invited the heads of the stakeholder organisations and institutions in the Nigerian downstream petroleum sector.

Those invited, in the letter seen by THISDAY, on Tuesday, included the Chief Executive Officer of the NMDPRA, the Managing Director of the Nigerian Gas Company (NGC) and that of the Nigerian Gas Marketing Company (NGMC), two subsidiaries of NNPC Limited.

Others were the Chairman of the Major Marketers Association of Nigeria (MOMAM), President of IPMAN and Chairman of DAPPMAN.

“Your various Memoranda should be forwarded to the Committee’s secretariat in 60 print copies and a soft copy at the House of Representatives Complex on or before Wednesday 22 June, 2022.

“As we look forward to receiving you, please accept the warmest assurances of the Joint Committee’s highest esteem.”, the concluding page of the letter read.

For the past few months, Nigerians have been going through difficulties to get petrol, diesel and cooking gas due to the scarcity and astronomical increase in the prices of the products, which are all imported.

The hike in the prices of the petroleum products, just like other commodities, has been blamed on the ongoing oil price rally, exacerbated by the ongoing Russia-Ukraine war and the resultant trade sanctions against Russia, a major global supplier of refined petroleum products.

A litre of diesel in Nigerian is currently selling for above N800 while a 12.5 kilogram of cooking gas is being sold for over N10,000 in some locations. This has pushed many users of the two products into using alternative sources like petrol generators, solar, inverters, firewood and charcoal.

However, petrol that is still selling cheaper despite the global hike in prices, owing to the huge subsidy the country is spending to keep the pump price at N165 per litre, far less than the actual landing cost, is now becoming scarce and unavailable in some states including Lagos, Oyo, Ogun and the Federal Capital Territory, Abuja.

The Chairman of IPMAN, Lagos Satellite Depot, Mr. Akin Akinrinade, had lamented the shortage of petrol in their depot, stated that since December 2021, not a litre of petrol had been lifted at the NNPC satellite depots at Ejigbo.

This, he noted, had left independent marketers at the mercy of private depots, whom he accused of hiking their ex- depot prices to a level no longer sustainable to sell petrol at N165.

The IPMAN chairman said based on current economic realities, the sustainable pump price for petrol in in the country should be at N180 per litre.

Peter Uzoho and Gilbert Ekugbe

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