After 48 days, a 14-person steering committee led by President Muhammadu Buhari that was put together to deal with petrol supply problems and set prices has not been able to end the shortage.
Reports from our correspondents showed that the product is even harder to find in some states, where drivers pay N300 for a litre.
But reliable sources in the oil industry told this paper that the president hasn’t started the panel yet, which is making people worried all over the country.
Daily Trust tried to get in touch with Timipre Sylva, who was the Minister of State for Petroleum Resources and was supposed to lead the committee that Buhari was in charge of. However, he could not be reached.
Officials at NNPC Limited, which is a strong member of the committee and the only company that imports petrol, did not answer this paper’s questions right away.
A top official told this paper that people in the industry want the committee to start working, but that hasn’t happened yet.
“We wanted to make sure the committee was set up and working, but that hasn’t happened yet. “What happened was that the heads of the agencies involved tried to take more steps to solve the problem,” the official said.
Another official in charge of regulations said that the president may have been told that the relevant agencies could handle the situation and that the committee wasn’t needed.
Lack gets worse in all states
As Nigerians wait for a long-term solution, the situation in all of the states in the federation has continued to get worse.
Motorists in Kano say that fuel is easier to find now than it was at the end of last year, but the price at private petrol stations is still high. Due to the lack of cash, they also said it was hard to get petrol because there were long lines at petrol stations.
A commercial bus driver named Malam Labaran Ibrahim said, “We usually give up a whole day to get fuel for N210 or N220.” So, we can get money to pay off our debts and feed our families. We get in line where we believe or know fuel will be sold the next day. “We usually get together in the evening and stay until the next morning,” he said.
Fatima Raji, a businesswoman in Kaduna, said that she had been paying between N300 and N350 per litre for petrol over the past three months.
“Things haven’t gotten better. I spend N300 at Future View, a petrol station close to Command Secondary School in Kaduna. It’s still the same. When the committee was set up, we thought it would help with the problem of not having enough. She said, “Unfortunately, it hasn’t.”
Barr. Femi Aborisade, the Managing Partner of ABOPE Chambers, said that the constant rise in fuel prices and the NNPC factor is nothing but a plan to steal the little money that most people have and give it to oil dealers.
We patronise private depots at N240/litre – IPMAN
The Kaduna Unit of the Independent Petroleum Marketers Association of Nigeria (IPMAN) blamed the inability of the federal government to keep the country’s refineries running for the continued lack of Premium Motor Spirit (PMS), which is also called petrol.
Alhaji Abdulfatah Murtala, the chairman of IPMAN in Kaduna, spoke on the phone with our Kaduna correspondent. He said that instead of buying petrol from the federal government at N171 per litre, they have been forced to buy from private depots at N240 per litre.
Murtala, who is also the managing director of Yusufa Petroleum and Gas Company, said that IPMAN members chose to buy petrol from private depots instead of the government because it took the government months to load the product when they bought it.
“Only the federal government is to blame for the lack of petrol, not IPMAN. The government sells us the product for N171 per litre, but it takes between one and three months before we can load it. So, we choose to buy it from private depots for N240 per litre.
“It costs us more than N2 million to move the product from the deport in the south of the country to the north. If you add that to other costs at the depot before loading, the price of a litre of the product would be N295. This is why many independent sellers charge more than N300 per litre for the product,” he said.
FG spends N2.4 trillion in subsidies in 6 months
Even though a lot of money has been spent on petrol subsidies, there has been a severe shortage of the product for almost two years, and it has gotten worse in the last six months. Over N2.4 trillion is thought to have been spent on petrol subsidies, according to Daily Trust.
Mele Kyari, the Group Chief Executive Officer of NNPC Ltd, said in February 2023 that about N400 billion is spent every month to subsidise petrol, which is about N202 per litre. At that price, Nigeria would have had to pay N2.4 trillion to keep the official price of petrol at N124/l.
But more stations sell the product for between N200 and N600 per litre, which makes the subsidy pointless.
Kyari had said that the cost of importing the petrol was broken down as follows: the landing cost of imported petrol was N315 per litre, but NNPC sent it to the marketers (depots) at a cost of N113 per litre.
“According to the Appropriation Act and the law, there is a subsidy on the supply of PMS and other petroleum products into our country. In terms of current data, the landing cost was about N315/litre three days ago.”
“Our customers are here, and we’re giving each of them N113 per litre. That means that for every litre of PMS, we bring into the country, there is a difference of about N202.
“To figure out how much subsidy you get each month, multiply N202 by 66.5 million litres by 30. This will give you over N400bn.” There is money set aside for this, but it also takes money away from us.
“When you don’t get a refund from the ministry of finance, it puts a strain on our company’s cash flow. But we will keep helping the country and making sure it has enough energy,” Kyari said.
The Nigerian National Petroleum Corporation (NNPC) said last week that there are 2.1 billion litres of PMS in stock, with 0.9 billion litres in all land depots and 1.2 billion litres on ships. This is enough to last 35 days as of March 4, 2023. NNPC also said that it plans to end March 2023 with about 2.8 billion litres of oil, which is enough for 47 days.
Subsidy not getting to Nigerians — NASME
Dr Adams Adebayo, who is in charge of the Lagos branch of the Nigerian Association of Small and Medium Enterprises (NASME), said that the subsidy wasn’t going to regular Nigerians.
He said that, because of the high cost of logistics, many petrol stations are getting their fuel from other places.
“This is because the government doesn’t keep an eye on it. I’ve said over and over again that subsidy is a scam.
He said, “If you want to subsidise and you want people to be okay, you subsidise what people eat every day.”
Why Buhari brought up the committee
In a statement on January 24, Sylva said that he was putting together a 14-person steering committee to make sure that petroleum products were available and that prices were set by the government.
The President and Minister of Petroleum, Muhammadu Buhari, is in charge of the committee, and the Minister of State is the other leader. It should make sure that stocks are managed and that everyone can see how the NNPC Limited refineries are being fixed up. It will also keep track of daily distribution to stop smuggling.
That would be the first time that the minister of petroleum and Nigeria’s president both led a committee in the petroleum industry. Nigerians had hoped for a lot of action, but sources say the committee isn’t even ready to work yet.
“The president was too busy with the campaign and the election. “That’s why he might not have had time to start the committee,” said a second source. The minister told NMDPRA to make sure that the government-approved ex-depot and retail prices for petrol were followed to the letter.
It told NMDPRA to make sure that the only supplier, NNPC Limited, meets the country’s domestic supply obligation for petrol and other petroleum products.
It said, “The federal government will not let misguided people cause a lot of trouble for the people and try to discredit the government’s efforts to build on the progress made so far in the oil and gas sector of the economy.”
The Minister of Finance, the Permanent Secretary of the Ministry of Petroleum, the National Economic Adviser to the President, the DSS, Customs, the EFCC, the NSCDC, the NMDPRA, the CBN, and the NNPC are also members.
