FG’s 8% petrol price hike fails to ease supply shortages

Forum 1 year ago

FG’s 8% petrol price hike fails to ease supply shortages

THE Federal Government’s decision to increase the pump price of premium motor spirit (petrol) by N15 per litre (8 percent) from N180 to N195 has failed to ease supply challenges in the country.

Four days into the new price regime, checks by Vanguard around Abuja and other parts of the Federal Capital Territory, FCT, showed that supply shortages remained with long queues noticed at petrol stations operated by NNPC Retail Limited and major oil marketers.

It was observed that at NNPC Retail outlets pumps have been adjusted from N179 it sold last week to N194. At stations operated by oil majors such as TotalEnergies, Conoil, AA Rano and Mobil, rates were adjusted from N180 per litre to N195.

At filling stations operated by independent marketers, pump prices ranged from N280 to N300 per litre.

The Minister of State Petroleum Resources Chief Timipre Sylva had in a statement by his media aide said President Muhammadu Buhari has not approved any price increase for PMS as reported in the media.

According to him, “President Muhammadu Buhari has not approved any increase in the price of PMS or any other petroleum product for that matter. There is no reason for President Muhammadu Buhari to renege on his earlier promise not to approve any increase in the price of PMS at this time. Mr President is sensitive to the plights of the ordinary Nigerian and has said repeatedly that he understands the challenges of the ordinary Nigerian and would not want to cause untold hardship for the electorates”.

But speaking to Vanguard from Port Harcourt, the Public Relations Officer, Independent Petroleum Marketers of Nigeria, IPMAN, Chief Chinedu Ukadike said the marketers in the eastern part of the country have been told the ex-depot price has been increased to N180 per litre.

Chief Ukadiake also disclosed that they have been informed that vessels bringing in petrol to Port Harcourt and Calabar ports would arrive before Friday this week to ease supply difficulties.

He disclosed that currently, independent marketers were purchasing their products from major marketers at N260 per litre, expressing optimism that the arrival of the vessels would end racketeering in the sector.

“NNPC Retail has communicated to us through their portal and so the product is N180 now, that’s the ex-depot price. Vessels are not here yet but they are anticipating vessels in Calabar port before Friday and also in Port Harcourt port before Friday too, that’s for the eastern region.

“For the western region, there are two just two depots working in Lagos and so there is still a shortage of products but they have assured us that they are doing everything possible to make the product available.

“Once we have product supply, the shortages and queues you are seeing will come down. This is because right now since there is no product, the marketers are scrambling to get supply”, he added.

On his part, the Executive Secretary, Major Oil Marketers Association of Nigeria, MOMAN, Mr. Clement Isong has said distortions in the market were to blame for the continuing distribution challenges.

He said the best way to resolve the distribution challenges is for the government to hands off the industry and allow the private sector run the sector.

“The government needs to allow a free market for all players. This will lead to reduction in demand because price will go up. A rise in price will attract investment that would lead to increase in supply.

“The biggest challenge in the market today is the high demand and we need to do something about it. Market interference is the reason for the distortion. It is simple economics where you have interference shortages will occur and this is the problem”, he stated.