Oil marketers are beginning to sell off their filling stations over scarcity of Premium Motor Spirit also known as petrol, coupled with the inability to afford products from private depots due to inflation,
Unlike members of the Major Oil Marketers Association of Nigeria with fewer stations operational in the cities, members of the Independent Petroleum Marketers Association of Nigeria currently have the largest number of stations, over 3000 scattered across the country, even to the remote areas.
Findings by The PUNCH revealed that the Nigerian National Petroleum Company Limited has cut down on product supply to IPMAN members due to scarcity.
“If our members say they need about 100 trucks of petrol, what we get from NNPC would be 5 trucks, and it doesn’t go round. Since NNPCL is still the only one importing, they sell at official price of N556 per litre to DAPPMAN while DAPPMAN sells to us at N616 per litre. By the time we add transportation and charges, pump price would be around N630 per litre.
“Who would buy such from us at N630 per litre? And remember that our members have Major marketers’ stations to contend with. MOMAN sells at lower prices because they get product directly from NNPC. But our members have to buy from DAPPMAN at N616 per litre.
“Because of that; most of our members are closing shop because they are running at losses and can’t afford to buy products from DAPPMAN due to inflation rate and lower patronage. The product is scarce, and even banks are unwilling to give us loan because they don’t want their money to be tied down” a source close to the matter told The PUNCH on Wednesday.
‘’Aside NNPCL selling directly to the public through its retail outlets, it sells to DAPPMAN members, who then resell to IPMAN members, further increasing pump prices at IPMAN stations.’’
Chairman Satellite Depot, Akin Akinrinade confirmed .
Akinrinade said he believed IPMAN members are being “sidelined and frustrated”.
“Your findings are true because our members are not getting products, and we are beginning to sell our stations because we can’t meet up with high price of products at private depots. They are frustrating our businesses.
“For instance, the challenges that the Satellite depot has was due to vandalism of the pipeline that brings product here. NNPC told us the pipeline had been repaired and that we would get product but up till today, we are yet to get supply.
“But maybe things will be fine when the refinery finally begins production in December but as we speak, we are not getting supply from NNPC and we can’t even afford product from DAPPMAN. And once this report doesn’t get product; you can be rest assured that the whole of Lagos and South West will be affected,” he told The PUNCH.
A former Chairman of MOMAN and Chief Executive Officer, 11 Plc had during an interview, told The PUNCH that the removal of fuel subsidies by President Tinubu in May would herald an increase in prices of petrol, which, according to him would result in major downstream companies buying over smaller ones.
“Since there is no longer a subsidy, smaller companies would not be able to sustain their businesses, and would be bought over by bigger companies like ours,” he said.
Pronouncement of an end to fuel subsidies by President Tinubu in May had heralded an explosion in prices of petrol from N185 per litre to between N585-N620 in Lagos State and its environs, and then N700 and above in the North.
A source in the NNPCL who begged anonymity as he was not authorised to speak on the matter, told The PUNCH that the Company was not under any obligation to supply products to other marketers since the downstream sector is deregulated.
“Whatever NNPC is doing now is to relieve the sector. The company is not under compulsion to supply the market. Petrol is now deregulated and marketers have been issued with import licenses. So, let them go ahead and import. Our own stations have products and we are selling to the public,” he source said.
Independent marketers have been unable to import products due to rising rate of the dollar against the naira which gave rise to inflation, coupled with increase in crude oil prices at the international market.
Brent price had during the year surged towards $100 per barrel before dropping to $81 per barrel as at 12:30PM Nigerian time on Wednesday.
The Central Bank of Nigeria dollar/naira rate as of Wednesday had dropped to N802/$1 after climbing to almost N1000/$1 last month from around N460/$1 in May, resulting in inflation in prices of goods and services.