• Sunday, May 19, 2024
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BusinessDay

Kegs back as scarcity spreads, petrol hits N2000/litre

Petrol scarcity

Petrol queues, crowded bus stops, traffic and hikes in transport fares have returned to most states in Nigeria with residents resorting to buying petrol in jerrycans, fondly referred to as ‘kegs’ as black market prices soar towards N2000 per litre.

Findings by BusinessDay showed long lines of motorists snaking around petrol stations, some waiting for hours only to be turned away due to lack of the product, despite assurance from the Nigerian National Petroleum Company Limited (NNPC) Ltd that the logistics issue had been resolved.

Marketers expect normalcy next week

A senior oil executive in Nigeria’s downstream sector said the petrol scarcity will end before the end of this week.

He noted that the current petrol scarcity is due to the scarcity of products caused by hitches in the logistics operations of NNPC Ltd.

“We expect that by next week or so, NNPC should be able to restore supply and within another week, normalcy should return,” the source said.

“The NNPC Group CEO has assured us that there will be improvement in the supply chain because their vessels are arriving,” he said.

Billy Gillis-Harry, the president of the Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) said its members do not have access to petroleum products.

“Well, from my perspective as a retail outlet owner and representing all the retail outlet owners who are members of PETROAN, I can tell you that our challenge is that we do not have access to the product,” Gillis-Harry said on Monday during Channels TV’s Morning Brief breakfast programme.

“So, once the product is available in all the depots, and we are being issued our products, we will certainly complement NNPC’s efforts to make sure that all the stations are wet and we are doing that consistently.

“Even in this season, at this time, NNPC in the last few weeks have squeezed in loading barges to encourage everyone including the NNPC stations and PETROAN members and even IPMAN members and we are taking products bit by bit to our various stations.”

At Isolo, inward Jakande Gate at Alimosho, BusinessDay’s findings showed only Northwest and Total filling stations were dispensing; while the NNPC franchise stations, especially in Lagos, had their gates closed to motorists due to a lack of stock.

Most filling stations visited in Ijegun local government areas of Lagos State were locked, while there were long queues at stations dispensing the product.

One Tunde Osunlusi said he waited for over two hours at NNPC Ltd, Ikoyi before deciding to look for an alternative.

“The reappearance of long queues at filling stations has caused frustration among motorists, many of whom have resorted to purchasing petrol in kegs from black marketers,” he told BusinessDay.

Another motorist who is also a driver attached to a tier one bank, who gave his name as Lekan Balogun, returned to his office without getting petrol to buy after waiting at TotalEnergies filling station in Ladipo, Mushin for over an hour.

“I can’t afford to waste hours waiting just to fill up the tank. But buying from these keg guys…well, let’s just say I hope the quality is alright,” he said.

On May 29, 2023, President Bola Tinubu eliminated fuel subsidies during his inauguration, which resulted in a tripling of petrol prices around the nation.

As per the requirements of the Petroleum Industry Act 2021, the elimination of the fuel subsidy was intended to allow the private sector to import petrol, thereby assuming the monopoly of petrol importation from the NNPCL.

But because private oil companies are unable to secure foreign exchange for importation, the NNPC Ltd has been Nigeria’s only source of petrol imports for months.