By Ayo Yusuf
Fuel scarcity may hit the country in the coming months as petroleum products depots get more deserted following the volatile foreign exchange rate which has now pushed landing costs of Premium Motor Spirit, popularly called petrol, to N720/litre.
Oil marketers reveal that filling stations were shutting down in large numbers daily as the business was becoming too tough to run and warned that this may herald another round of fuel scarcity soon.
With the landing cost of PMS in Nigeria now increased to N720/litre, up from N651/litre in August this year, many depots have become deserted.
Speaking at the National Executive Council meeting of the Natural Oil and Gas Suppliers Association of Nigeria, in Abuja, on Thursday, the National President, Benneth Korie, said a lot of depots were presently dried up or out of stock.
He said, “Depot owners are so terribly affected by the increasing cost of crude oil and exchange rate, to the extent that many depots are practically deserted as their owners are unable to secure bank loans to fund their business due to high-interest rates.
“Banks are not willing to guarantee funds release to stakeholders as a result of the difficulty, instability and galloping rates of foreign exchange and high cost of the dollar. Many depots are presently dried up or out of stock, and this is no gainsaying as it is evidently verifiable.”
He further added that the, “Worst hit are filling stations whose owners find it extremely difficult to secure funds to procure products for their retail outlets. Both the independent and major marketers are so terribly affected.
“As of today, filling stations are shutting down in great numbers on a daily basis and dealers are going out of business, with many more on the verge of bankruptcy because of their inability to secure funds to facilitate orders for their stations.”
Mr. Korie said the government must urgently come to the aid of the industry as quickly as possible to save it from an impending colossal collapse, which would result in a more devastating blow to the economy at large.
The Chief Executive Officer, PETROCAM Trading (Nig) Ltd., Patrick Ilo, said 52,000 metric tonnes of petrol imported by the company on Tuesday was already N720/litre without subsidies.
According to him, if the landing cost was already N720, the pump price should be around N729/litre in Lagos State if the federal government had truly stopped subsidising the product.
“This is the second time I am bringing in my vessel. But after bringing it in, I am trapped. I can’t sell it because I landed my own product at N720. And if you add transportation from depot to station, the value today should be N729/litre at the pump,” he noted.
He blamed the price hike on high foreign exchange rate, adding that the federal government was still subsidising petrol through the Nigerian National Petroleum Company Limited.
The foreign exchange rate of the Central Bank of Nigeria as of Wednesday was around N766/$1, while it hovered around N990/$ at the parallel market.
He said.”Yes, PETROCAM has an import license, and we have products in Nigeria. I want to say this out loud that I brought (in product) 52,000 metric tonnes of PMS today, which I borrowed about sixty-something million dollars to import.
“But I cannot sell. Why? Because of the price NNPC is selling. NNPC to my mind, they are still subsidising. NNPC is quietly subsidising the market. And I don’t blame the government. It is when we have a stable government that there could be prosperity.”
Ilo added that, “As of today, NNPC is subsidising these products. And I’m talking about a subsidy of more than N100/litre. Because if you need to sell today, I landed my own product at N720. So how do you look at it? You look at it from the perspective of how much is diesel.”
In another development, a Borno State-based philanthropist, Ibrahim Jibrin Mohammed, on Wednesday, subsidised the price of petrol to N415 for people in Kano State.
According to the philanthropist, the gesture was in line with the directive of the First Lady of the country, Senator Remi Tinubu, asking the support of Nigerians to cushion the effects of fuel subsidy removal.
Alhaji Mohammed, who was represented by his coordinator, Abbakaka Hassan, also said the intervention was conceived to reinforce what the Bola Tinubu government was doing to cushion the suffering of the masses.
He said, “We are doing this across all the six geopolitical zones of the country. We started in Maiduguri for the North East, did in Abuja for the North Central, and today we are in Kano for the North West.
“We will also do it in Lagos (South West), Port Harcourt (South South) and Enugu (South East).
“We will be selling the fuel to commuters throughout the day until we exhaust what we have. We are targeting as many people as possible.”
