10 July 2012

Nigeria: Ex-Depot Price of Petrol Rises to N91 per Litre

There was concern at the weekend over imminent fuel crisis in the country as the ex-depot price of petrol hit an all-time high of N91 per litre, the highest since the official pump price was adjusted to N97 in January 2012.

This development followed the refusal by private marketers and other independent importers to bring new cargoes into the country, on account of unpaid subsidy claims.

Before the looming crisis, both the Nigerian National Petroleum Corporation and the private marketers were selling at ex-depot prices of between N86 and N86.50 per litre, but the highest ex-depot price at which the product was ever sold since January was N88.50 per litre.

Currently, the official ex-depot price recommended by the Petroleum Products Pricing Regulatory Agency (PPPRA) is N87.66 per litre.

THISDAY gathered that only NNPC imports petrol as both the major and independent marketers have made good their threat to suspend importation, pending the payment of the outstanding 2011 and 2012 subsidy claims.

Acting Group General Manager in charge of Group Public Affairs Division of the NNPC, Mr. Fiddel Pepple, however told THISDAY at the weekend that the corporation would continue to meet its obligations in the importation of petroleum products.

"All I can tell you for now is that NNPC will continue to meet its obligations of ensuring regular supply of petroleum products. I will give you details of what we are doing in the area of fuel importation as soon as it is available," he said.

It was learnt during the weekend that the marketers buy from NNPC at N87.66 per litre and sell at between N90 and N91 in the depots.

The current uncertainty in supply, it was learnt, has forced depot owners not to guarantee bulk purchases to dealers who may want to pay for 20 to 50 trucks, fueling concerns that marketers may capitalise on the shortfall to increase the pump price.

Some of the marketers, who spoke to THISDAY acknowledged that there is still petrol in the system but added that NNPC was the sole supplier, raising concerns over the capacity of the corporation to bridge the supply gap created by non-importation by marketers.

"The product all the marketers are loading from their depots now was bought from NNPC. Prior to this, we use to have both petrol we bought from NNPC and the one we imported. But no private marketer is importing at the moment.

"Many people are ready to pay and lift products from the depots but the supply cannot match demand and no marketer can even guarantee bulk purchases any longer," said one of the marketers.

THISDAY gathered that the Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association (DAPPMA), Independent Petroleum Marketers Association of Nigeria (IPMAN) and NIPCO Plc have suspended product imports for the third quarter.

However, it was not clear if other independent importers that do not belong to any of these groups have utilised their third quarter allocations but these groups are gradually being excluded from the Petroleum Support Fund (PSF) scheme by PPPRA.

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