In Nigeria, petrol scarcity has been a pressing issue, causing long queues at gas stations and significantly higher pump prices, especially among independent marketers. This situation has been exacerbated by a variety of systemic and operational challenges within the Nigeria National Petroleum Company Limited (NNPCL) and the broader petroleum distribution network.
As reported by Vanguard, there’s a notable price disparity between the major marketers and independent operators. The former are selling petrol at an average price of around N605 per liter, while the latter have increased their prices to an average of N730 per liter, with some extremes reaching as high as N900 per liter in more remote areas. This price gap has widened due to the independents’ need to source petrol from the open market at higher costs, attributed to system breakdowns and restricted access to NNPCL’s supply.
The Independent Petroleum Marketers Association of Nigeria (IPMAN) explains that these price hikes at their stations are due to several factors. First, the NNPC Retail’s portal, a critical channel through which members historically accessed government-supplied oil, has been offline due to upgrades, leaving them without direct access to subsidized rates. Consequently, independent marketers must purchase petrol from secondary sources like tank farm owners and major marketers, often at elevated prices.
Chief Chinedu Ukadike, the Public Relations Officer for IPMAN, elaborated on the dilemma faced by independents. “We source our product from the open market because the NNPC portal is down. It is undergoing an upgrade and we have not had any access to it. Without access, you cannot get a product,” he explained. Adding to their woes, licenses for marketers are also being updated, which has slowed their ability to procure petrol affordably and efficiently.
The logistics of transporting petrol from these alternative sources further inflates costs, contributing to the price at the pump. “Presently, we load between N650 to N700 per liter. By the time you add the cost of transportation and other logistics, you will realize how difficult the sector is for independent marketers,” Ukadike added.
Additionally, Maxi Oliver Okolo, Chairman of IPMAN’s Aba Depot, pointed out that independent marketers are currently loading petrol from privately owned depots at around N800 per liter. “It’s impossible for us to sell below that amount and that is why we have asked the government to intervene and ensure that we also get our products directly from NNPC depots. That is the only way we can compete and remain profitable,” he stated.
Despite these challenges, major marketers have managed to keep their stations operational and relatively stable in terms of pricing. Clement Isong, CEO of the Major Energy Marketers Association of Nigeria (MEMAN), highlighted the collaborative efforts among major marketers, such as product swaps and shared logistics at the Apapa hub, which have helped mitigate some of the impacts of the scarcity. “We do what we call product swaps. So, if I run dry in my depot, I can go and take from another MEMAN company depot and later when I have products, I can give him back the product that I took from him,” Isong explained. This cooperative strategy among major marketers has ensured a more steady supply at their stations.
The dire situation calls for a swift governmental response to address the inefficiencies in the petroleum distribution network and to ensure equitable access to resources for all marketers. Without timely interventions, the disparities in petrol pricing and supply could worsen, further straining consumers and the economy.
Efforts to contact a spokesperson for NNPC Limited were unsuccessful, leaving some of these issues unaddressed from the corporation’s perspective. The ongoing challenges highlight the need for a more robust and reliable system to manage Nigeria’s petrol supply and distribution to prevent future scarcities and to stabilize the market for all stakeholders involved.
Source: Vanguard
