Lingering fuel scarcity

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Nigeria is no doubt passing through its worst fuel scarcity in recent years. The scarcity which started about two months has drastically caused inflation and also affected negatively economic activities in the nooks and crannies of the country.

The scarcity worsened in the last few weeks, with motorists spending long hours at filling stations, to buy the product at exorbitant rates.

While most fuel stations are out of stock, even with the official pump-price at N86.50k, independent marketers sell for as high as N200-N220 per litre. Unfortunately, black market hawkers have resurfaced, selling PMS for as high as N400 per litre.

Regrettably, fuel scarcity is almost becoming a common phrase in our socio-economic lexicon such that it has become an endemic phenomenon.

It is, indeed, a paradox that Nigeria produces oil and yet cannot adequately meet up with its local consumption of petroleum products considering that our four refineries are producing below capacity and so, the country has to depend on the importation of the shortfall to adequately service its local consumption even as government determines the price and pays subsidy to make the product affordable for citizens.

Today, Nigerians are groaning under the excruciating pains caused by the biting scarcity while the supply of electricity has remained deplorable. As it persists, every facet of life has been negatively affected. The prices of food and other essential commodities have hit the skies, while cost of transportation is arbitrarily being increased.

Regrettably, this is happening at a time when citizens are grappling with other economic challenges inflicted by unpopular government policies. It is feared that with the current trend, most Nigerians would find it difficult to eke out a living.

Various reasons have been adduced for the present scarcity, among which is the difficulty experienced by oil marketers procuring foreign exchange for the importation of petroleum products. This has made the Nigerian National Petroleum Corporation (NNPC) assume the role of sole importer of refined products.

The National Chairman of Petroleum Tankers Drivers PTD, Comrade Salimon Akanni Oladiti opined that the supply chain had become, “fragile since the NNPC assumed role of sole importer, controlling 78 per cent of the nation’s petroleum needs, with other marketers sharing the remaining 22 percent.”

NNPC Group Managing Director and Minister of State for Petroleum Resources, Dr. Ibe Kachikwu promised last week that petrol would be available within two weeks, even as he promised to sanction depot owners who sell petrol above the approved ex-depot price of N77.00.

The assurance came after his controversial statement that regular fuel supply could not be guaranteed until May this year.

Nigerian NewsDirect asks government to find an immediate and permanent solution to the lingering fuel scarcity. We are deeply worried that this is happening in a leading oil-producing nation like Nigeria. Since the existing supply chain has proved inadequate in meeting huge demands, it should therefore be decentralized to make for a competitive bidding process.

It is unacceptable that the palliatives NNPC is relying upon to make fuel queues disappear shortly are based on expected delivery of imported products, said to be awaiting discharge at the ports.

 

Since these palliatives do not offer permanent solution to the crisis,

Nigerian NewsDirect calls on President Muhammadu Buhari to urgently

come up with policies that would end this perennial fuel shortage.

This moral burden is critical, not only because he is the substantive

Petroleum Minister, but also because he has traveled this road before.

 

 

 

To this end, it is imperative that the apex bank puts measures in

place to ensure that the Naira appreciates or does not suffer further

devaluation considering that it will engender rising prices of fuel.

Certainly, a stronger Naira would attract a host of investors into

private domestic refining as fuel prices will progressively and

steadily fall even below subsidized price.

 

Beyond this, we also expect government to completely deregulate the

downstream sector of the oil sector in the country. But it is

important that the Petroleum Industry Bill (PIB) which has been lying

idle in the National Assembly for years be passed considering the

provisions therein that will induce a more robust oil industry.

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