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Dr. Ifeanyi Uba

Capital Oil Boss Seeks Solid Foundation For Deregulation …Claims To Hold Strategy For Seamless Deregulation


key player in the Nigerian fuel market has tasked the new government of President Muhammed Buhari must lay the infrastructural foundation for deregulation of the Nigerian downstream petroleum sector in a measured plan that would dis­place huge volumes of imported petroleum products with locally refined ones.

Managing Director of Capital Oil and Gas Industries Limited, Dr. Ifeanyi Uba, declared in La­gos that the prevailing massive importation of petroleum prod­ucts was sapping the lean for­eign exchange earnings of the country at a time of steep fall in the prices of crude oil in the in­ternational market.

Dr. Uba who said he has a potent strategy for seamless dereg­ulation of the domestic fuel mar­ket pointed out that the burden of subsidy regime and massive importation of key transportation fuels in the country has become too heavy for the country’s lean revenue streams.

He pointed at huge subsidy debt overhang in the market as key stress index in the subsidy arrangement and warned that the efficient deregulation of the market has become inevitable.

According to him, Capital Oil alone is still owed N11.9 billion subsidy debt since 2012 while other marketers in the country are also owed different sums of money under the subsidy scheme. He made it clear that the government debt profile in the market might continue to rise if early plans are not ac­tivated to replace importation with locally refined petroleum products.

Apart from the government’s huge subsidy bills and conse­quent debts in the market, Dr. Uba also pointed out that mas­sive importation of petroleum products has continued to de­plete the country’s foreign ex­change reserves and negatively impact her balance of payment.

According to him, fuel imports account for over 90 percent for­eign exchange demand from the Central Bank of Nigeria (CBN) as importers of other products now use fuel importation as de­coy to secure foreign exchange to import other products not ap­proved by the government.

Ending importation of petro­leum products in the country and deregulating the domestic fuel market would be the one meas­ure that would address a plethora of economic problems facing the country, Dr. Uba emphasized.

He however advised Presi­dent Buhari not to attempt deregulation under the cur­rent domestic refining situa­tion, warning that such a move would create supply gaps that might disable the key sectors of the economy.


– Sopuruchi Onwuka

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