Monday, 23 January 2023 05:55

Fuel scarcity worsens nationwide. Marketers explain why the situation won’t return to normal any time soon

Rate this item
(0 votes)

There are strong indications that the current fuel crisis across the country may worsen in the days ahead with the introduction of a N16 per liter lithering charge. Daily Sun investigation found.

The hike in lithering charge has forced some filling stations, especially those operated by independent marketers, to raise pump price to between N270 and N300 per litre.

Major Oil Marketers Association of Nigeria (MOMAN) had said the delay in implementation of the Petroleum Industry Act(PIA) was slowing down new investments and subsidy removal.

The Federal Government had last year shifted the removal of subsidy till June this year, a move that has been condemned by stakeholders

Some of the marketers who spoke to our correspondent in confidence at the weekend, said the lithering charge hike from N10 per liter to N16 per liter was an additional cost on business.

They lamented that the hike in litering charge to N16 per liter has many private depot owners abandoning the product.

They explained that even though there was product on the high sea, the associated cost involved in evacuating the product to depots was no longer sustainable and economical for business.

The marketers said the number of daughter vessels available for evacuation of petrol from the high sea was grossly insufficient to service the number of marketers requiring the service.

‘‘Since NNPC is the only importer of petrol, we have to source the product from them and nowhere else. But they have hiked the lithering charge and that has become a source of concern to us. How much are we going to sell to offtakers.

Apart from the hike in lithering charges, they lamented that some cost elements which hitherto were paid in naira are now being charged in Dollars.

“Another factor contributing to this scarcity is the increased cost of hiring daughter vessels which moved from $24,000 per day to $50,000.All these cost are to be factored into the final landing cost at the depot.

MOMAN in a statement released at the weekend said the major cause of the fuel scarcity is the shortage and high (US Dollar) costs of daughter vessels for ferrying product from mother vessels to depots along the coast.

According to MOMAN, the next challenge is the inadequate number of trucks required to meet the demand to deliver products from depots to filling stations nationwide.

‘‘These high logistics and exchange rate costs continue to put pressure on prices at the pump. Over the past three months, staff and management of MOMAN companies have worked diligently at depots and filling stations to relieve the stress faced by customers through the Christmas and New year period.

“Our members have again agreed to extend depot loading hours as well as keep strategically situated service stations open for longer hours to ease access to fuels for our customers.

“MOMAN shall continue to use its best endeavors to ensure that product is sold at the pump at prices currently approved by the Regulatory Authorities, despite pressure on price by demand and costs in our immediate operating environment.”

MOMAN, however, advised that a final resolution of these challenges will be the full deregulation of the petroleum downstream sector to encourage liberalization of supply and long-term investments in distribution assets, urging the government to work towards this goal.  

 

Sun