- Supply glitch worsens shortage nationwide
- Companies mull hybrid work on high transportation cost
- Dealers summon emergency meeting, warn against panic buying
The promise by the Nigerian National Petroleum Corporation Limited to restore normalcy in the distribution of Premium Motor Spirit, otherwise known as petrol, on the first day of May is yet to materialize as most Nigerians are still seen scavenging for the product, forming long queues at dispensing stations across the nation to keep their homes and businesses running.
Nigerians are suffering from long queues, that last hours and sometimes the whole day due to the country’s persistent fuel scarcity, which has lasted for over two weeks, and the price of petrol is beginning to eat deep into their pockets.
Findings by The Point showed that a litre of the commodity has been selling for as much as N2,000 in some locations in the country while major marketers who have some supply dispense for as much as N680 per litre.
The NNPCL had attributed logistics challenges to the supply shortfall, noting that it was on top of the process of restoring normalcy of the product supply in the country.
But sources close to the NNPCL revealed that a shortage in import of the product rather than logistic issues is responsible for the hardship that Nigerians have been plunged into in the last two weeks, arguing that until the major importer of fuel (NNPCL) can bring in enough of the product into the country, the problem would linger.
“We are having this problem (scarcity) because the market is undersupplied. The market needs about 50 million litres per day and it is getting only 25 million litres per day.
“The NNPCL is the sole importer/supplier of petrol to the market and it seems it has some issues with its suppliers. We learnt that a refinery that the NNPCL has a crude swap deal with in Europe underwent Turn Around Maintenance a month back, and this affected its supply to the NNPCL. Although we gathered a few days back that the problem has been overcome but if the scarcity still persists till next week (this week), it simply means that the NNPCL has not been importing enough to meet our need,” an insider at the NNPCL told The Point at the weekend.
“NNPCL told us that they had a problem with logistics but the problem is over now and they will start supplying products to the various depots so that we can start loading with immediate effect.”
Oil dealers also confirmed that the NNPCL has been able to sort out its logistics problems that triggered petrol scarcity, a development that forced the cost of the commodity to hit N800/litre in filling stations, particularly in the North.
They stated that although the NNPCL had addressed its problems of logistics, marketers are currently contending with the same problem as they strive to move petrol out of Lagos, Warri, and Port Harcourt to other states.
The petrol scarcity has distorted business activities in Abuja, Niger, Nasarawa, Sokoto, Gombe and many other states, following the inability of the NNPCL to sustain supply.
Although the Dangote Petroleum Refinery has commenced the sale of locally produced Automotive Gas Oil, popularly called diesel, it has not started pumping out petrol, which is more consumed by motorists than diesel.
Also, the Port Harcourt Refining Company, managed by the NNPCL, had continued to miss the targets set by both NNPCL and the Federal Government for the plant to commence the production of refined petroleum products.
Hence, petrol is still being imported into Nigeria by the NNPCL and any slip by the national oil firm in terms of PMS supply often leads to scarcity and massive queues at filling stations by motorists.
Marketers attributed the current scarcity of petrol to a shortage in its supply by NNPCL, while the national oil company blamed it on problems with logistics, but stated that it had addressed the concern.
“NNPCL told us that they had a problem with logistics but the problem is over now and they will start supplying products to the various depots so that we can start loading with immediate effect,” the National President of the Independent Petroleum Marketers Association of Nigeria, Abubakar Maigandi, told The Point on Sunday.
He added, “Now we have started loading, we also have our problem with logistics because we have to carry products from the private depots to our filling stations, which we have started doing. By God’s grace, I know the queues should clear soon.
“However, I cannot specifically tell you the time, because it takes some time before we can start moving the products into the various states. We are addressing the logistics problem that we have and we are expecting our members to start loading in full.”
The IPMAN president explained that dealers load products from Lagos, Port Harcourt and Warri depots to other destinations across the country, adding that there was no official plan to hike the price of PMS.
“Products are mainly loaded from Warri, Port Harcourt and Lagos to other parts of the country, particularly to the northern states. The trucks have started coming in, as some filling stations in Abuja have started getting fuel, but we still have queues because up till now some people have been involved in panic buying.
“Many people want to buy because they feel the scarcity will linger till the end of this week or they feel that there is a price change, which is not true. There is no change in price and we have not heard about such a plan.”
The Chief Corporate Communications Officer, NNPCL, Olufemi Soneye, had also urged motorists not to be involved in the panic buying of petrol because the national oil company had enough.
He also dispelled claims of a possible hike in petrol price by the company.
Key marketers close shops as truck of petrol jumps from N5m to N25m
Speaking on why retailers hiked the pump price, a marketer said, “For the retailers, they seized the opportunity to make money. Most filling stations have shut down for a long time because of the small margin and they could not raise N25m to buy a truck of petrol, something they used to buy around N5m before.
“35 to 40 percent of filling stations have closed shops. Those who did not want to close up now contribute money to jointly buy a truck of 33,000 litres to share. Only a few can independently afford one truck. The margin is low and the sales are low too.
“If you are in a place where you can’t sell up to 50,000 litres daily, you will be running at a loss by the time you look at your overhead cost, salaries, energy cost, security and others. This is not a profitable business as of now. If you can’t exhaust a truck in a week, then that is not a good business.”
As the fuel queues continue to spread across the country, marketers of petroleum products say they have commenced the distribution of 300 million litres of Premium Motor Spirit to different filling stations.
The Major Energies Marketers Association of Nigeria at a press briefing last week disclosed that its members in Apapa and other locations in Lagos had been receiving fuel from eight vessels since last week.
Also, the South West Regional Coordinator of the Nigerian Midstream and Downstream Petroleum Regulatory Authority, Ayo Cardoso, confirmed to The Point that aside from the 240 million litres offloaded at various depots on April 29, close to 85 million litres of petrol were offloaded as of April 30, 2024.
Companies mull hybrid work on high cost of transportation
The Point monitored the situation in different locations across the country and discovered that the fuel crisis which started two weeks ago has been getting worse despite the assurances from the government
It was also gathered that employees’ request for remote work has been on the rise over the lingering fuel scarcity that has doubled the cost of transportation in Lagos, the country’s commercial centre.
Cost-conscious Nigerians are cutting back on spending to survive the difficult moment of the cost of living crisis, especially on transportation costs when the trip is not too essential.
Workers whose work can be done from anywhere are pleading with their employers to grant the work from home option, or reduction in the number of days to work in the office, which became popular during the COVID-19 pandemic outbreak.
“I have been in this queue at an MRS filling station on the Island for over three hours to get fuel for work tomorrow, and there’s no hope I’ll get it. I might have to request permission to work remotely tomorrow,” a financial consultant at a top consultancy firm, Bunmi Williams, said on Sunday.
Also, Monday Ihemeson, lamented that he spends over three hours daily commuting to/from his home in Ikorodu to Lekki where his office is located since the fuel scarcity started.
“I was forced to work from home because I spend most of the productive hours on the road. It has been really frustrating and nobody is being held accountable for the fuel scarcity,” he lamented.
Most employees like Ihemeson and Williams have been forced to ask for more days to work from home due to the ongoing fuel scarcity that makes commuting both expensive and challenging.
“Before the scarcity, I had just Thursdays as my work-from-home but for some time now I have worked from home on Tuesdays too because I do not have enough fuel to come four days a week.
“I buy mostly from the black-market which is two times the usual price, it’s either that or I queue the whole day trying to get fuel,” a research analyst, Emeka Ndubisi, said.
“I think that employers should try to help their workers by going hybrid, especially those that are not vital. I tried getting fuel before coming to work,” a legal adviser to a pharmaceutical company, Chimamanda Uzoka said at the weekend.
She said that even people who use public transport are affected because the fare has increased and the queues along the roads cause heavy traffic making people get to work late and exhausted.
An accountant, Mazino Oghenetega, explained that he had to review his budget for transportation due to the fuel scarcity.
Previously I was spending N20, 000 per week on fuel going to work, now I spend N25, 000 making it N100, 000 per month. This is half my salary; I don’t know how feasible it is to be at work physically.
“I’m considering asking my line manager for a day of the week to work from home,” he said.
For those using buses to commute, the situation is more difficult as the average price of transportation across the city has doubled.
Transportation from Pako to Oyingbo which was N300 before has increased by 100 percent to N600; from Oyingbo to Apapa has gone up from N300 to between N400 and N500 depending on the time of the day.
From Costain to Apapa which was N300 is now N500. A trip from Ketu to Costain that cost N500 is now N700 and to Ojuelegba now costs N600 which was formerly N400.
A baker, Rebecca, told The Point how the increase in fuel prices affects other sectors of the economy, saying that prices of materials for producing bread had increased due to the cost of transporting raw materials and finished items to the market.
Marketers summon emergency meeting today
Meanwhile, as the fuel scarcity deepens across the country, marketers under the aegis of the Independent Petroleum Marketers Association of Nigeria have said their National Executive Council would be meeting officially on Monday (today) to find a lasting solution to the problem.
The National President of IPMAN, Hammed Fashola, said that Monday’s meeting became expedient following the prevalence of fuel scarcity despite recent aggressive moves by the NNPCL.
Fashola said that the NNPCL, which is the sole importer of petroleum products in the country, opened up its reserves in all existing depots across the country on Friday in a bid to ease off the long queues at the fuel stations.
“Most filling stations have shut down for a long time because of the small margin and they could not raise N25m to buy a truck of petrol, something they used to buy around N5m before.”
He said the Monday meeting is to assess how far the recent moves have gone in addressing the scarcity of petroleum products across the country and that the oil marketers would further engage the NNPCL with outcomes of the meeting.
“We are meeting on Monday officially with other marketers. We are working closely with NNPCL. The Monday meeting is for our National Executive Council. After the meeting, we will reach out to the NNPCL. We talk with them every day,” he stated.
On the likely subject of the Monday meeting, he said, “It will be to assess the present situations. We evaluate what we have done so far. We will look at what is happening in the cities; assess the situations to know what to do again.
“The meetings we have been having with the NNPCL are in collaboration, which we have been doing. If you notice, yesterday (Friday), NNPCL opened up their reserves in all the depots throughout the federation. And we are working with them to ensure that everywhere is wet so that this thing (scarcity) can disappear.
“I want to commend NNPCL for their proactive measures. We are equally giving them the necessary support we are supposed to give them as oil marketers. I want to use this opportunity to appeal to members of the public to stop panic buying. They should buy what they need. Once they buy what they need, you will see that the long queues will disappear. So we are trying to discourage that (hoarding),” he stated.
Also, the Petroleum Products Retail Outlets Owners Association of Nigeria on Saturday held a meeting with other independent marketers in a bid to end the lingering fuel scarcity in the country.
The president of PETROAN, Billy Gilly-Harry, said aside from developing new ways to prevent hoarding of petroleum products in the country, the meeting was held to also discuss how the products can directly get to Nigerians, including those in the rural areas at the given official rate.
“The meeting cut across all the associations. NNPCL has already called us and discussed it with us. We have had meetings with them. So last night’s meeting had nothing to do with NNPCL. It is about how to apply the solutions they have provided. And that is why you heard me talk very confidently that the solution (To the fuel scarcity) is in the corner,” he said.
“The good news is that this is a new reality. And it is going to bring better solutions because when you have NNPCL doing what they have to do, and we also doing what we have to do, the result will be fantastic. If you go to Abuja today, you will see that the queues have eased off. In the South-South and South-East, those who have been selling products as high as N670, we are bringing them to the book,” he added.
