Amid Low Stock And Drier Stations, Major Oil Marketers And National Association Of Road Transport Owners Suspend Lifting Of Petroleum Products And Break Supply
Nigerians must brace for harsher impact of the prevailing fuel scarcity following coordinated withdrawal of supply services by marketers and transporters that control the domestic fuel supply chain. The market groups are pressing for payment of disputed N200 billion subsidy arrears owed them by the government for supplies made to the domestic market in the last quarter of 2014 and first quarter of 2015. Whereas the various marketing groups in the country have shut down their storage depots, the owners of haulage tankers have also withdrawn their services and left the retail outlets without any means of replenishing stock.
Meanwhile, the Nigerian National Petroleum Corporation (NNPC) can no longer guarantee the nation of sustainable intervention in the market following fast depleting stock level. Market survey by The UNION yesterday showed that tanker drivers were not allowed into most of the depots for loading following directives by the National Association of Road Transport Owners (NARTO) to depot owners to stop further loading on their tankers until payment disputes between marketers and government is resolved. The transport owners claim that N200 billion owed marketers by the government under the controversial subsidy regime directly translated into inability of the marketers to promptly pay for haulage services by road tanker operators.
Government had at the end of April released N154 billion to pay marketers part of the outstanding subsidy claims to stave off the first phase of the coordinated strike by marketers and haulage service providers in the market. The Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN), Mr. Thomas Olawore, had on May 1 stated that marketers would pay tanker owners in the same proportion that government paid them, warning that the strike would continue within weeks if government failed to totally defray remaining N200 billion subsidy claims. Our source at a major depot in Apapa, Lagos stated that market supply situation had become very gloomy with the prevailing situation, adding that product feed to retail outlets had become precarious with the combination of low stock level and strike by key players in the supply chain.
The marketers said that the last meeting they had with the Minister of Finance, Dr Ngozi Okonjo-Iweala, in Abuja ended in a deadlock. Whereas government had put the subsidy debt at N131 billion while the marketers insisted on N200 billion. Mr. Olawore told The UNION that the marketers currently have no active channel of communication with government that might lead to urgent resolution of the fuel supply impasse, denying any knowledge of the circumstances that led to the action of NARTO and DAPPMA. At depots where NNPC holds stock, the situation was the same, and the spokesman of the corporation, Mr. Ohi Alegbe, could not confirm if any of the shut down depots had government stock as at yesterday.
He added that the corporation’s stock level was no longer certain after weeks of continuous depletion to keep the market wet. At one of the stations, a source said NNPC’s stock level had gone very low, adding that the corporation might no longer be able to boast of one month supply sufficiency in the face of the current overdependence on reserves. In reaction to the total shut down of the depots, the National Union of Petroleum and Natural Gas Workers (NUPENG) declared that the prevailing fuel scarcity might worsen. South-West Chairman of the union, Mr Tokumbo Korodo, confirmed to newsmen in Lagos that tanker drivers could not load petroleum at the depots on Monday. He said the depots were shut down as Depot and Petroleum Products Marketing Association (DAPPMA) engaged government over the outstanding N200 billion claims by marketers, adding that the marketers were also making moves to extract payment commitment from the incoming government before they could resume normal operations. The outcome of a meeting with the President-elect, he pointed out, might determine if marketers would reopen the depots for loading or import more fuel into the country.
Meanwhile, a survey of the filling stations in Lagos showed that sharp market practices dominate retail activities with independent marketers breaking the official price ceiling, hiking prices from N87 per liter of petrol to as much as N140 per liter. It was observed that most of the fuel dealers still have comfortable stock levels but sell only to desperate motorists at agreed prices, while the corporate business organizations, especially banks, form their key bulk demand customers. However, some major marketers like Oando, Mobil and NNPC Retail have kept faith with official price ceiling but host mad crowds of desperate motorists and small business operators that also throng their filling stations with plastic cans. Some of the major marketers also sell at the official price but charge flat entry fees ranging from N200 to N500 per motorist.