Oil marketers have disclosed that the least price the Nigerian National Petroleum Company Limited (NNPC) can sell Premium Motor Spirit, popularly called petrol, to them without subsidy, is N400/litre.
Gatekeepers News reports that the oil marketers made the disclosure on Sunday while giving other reasons for the continued scarcity of petrol which has led to the lingering queues at filling stations nationwide and a hike in the pump price.
According to them, PMS import charges were becoming unbearable for the sole importer of the commodity (NNPC). They stated that the NNPC had been subtly pushing these charges to depot owners. While depot owners, on their part, were also passing the charges to filling stations, which in turn pushed it to the final consumers of the product.
The Federal Government is alleged to have quietly allowed depot owners to raise the ex-depot price of petrol to about N185/litre, whereas the approved rate used to be N147/litre.
National Public Relations Officer of the Independent Petroleum Marketers Association of Nigeria, Chief Ukadike Chinedu, confirmed that NNPC was currently finding it tough to continue subsidising PMS.
“The least that NNPC can sell petrol is over N400/litre to depots and not at N145/litre, but because of subsidy, which is becoming over-bearing on them, the oil firm has been struggling to subsidise,” he stated.
He added, “That is why you see the lapses. The government is looking for dollars to import this product and pay the contractors importing for NNPC, and it is also trying to subsidise PMS.”
Ukadike explained that the landing cost of PMS in Nigeria was about N450/litre, as he noted that subsidy on PMS was no longer sustainable.
“The government will not continue to be Father Christmas and cripple the economy. Subsidy must stop!” he stated.
Oil marketers also explained that the rise in the Dollar also contributed to the PMS scarcity witnessed in Nigeria.
“The dollar is affecting PMS purchase, something you were buying for about $15/tonne when the dollar was about N440 to N450, but currently the dollar is about N750 to N800. Definitely, the price of the product will increase,” a major marketer, who pleaded not to be named due to lack of authorisation, told The Punch.
The official added, “You can buy a product, say $10/tonne from maybe Russia, it will get to Nigerian waters at that rate, but most of those mother vessels, as soon as they discharge into your own vessel, whatever rate you now pay will be international rates in Dollar.
“The mother vessel has its limit, it has to be stationed at Atlas Cove. But the daughter vessel you are going to charge, which brings in the product, will be charged in dollars. They don’t take naira. So all these charges come in dollars.”
The source also stated that these charges were currently hitting hard on the NNPC, as the oil company was finding it tough to bear the increased fuel imports’ rates.
“All vessels operate on international rates and it must be in forex. So as it is now, the rates are getting so high for NNPC to bear alone. Some of these charges have to be pushed to depots that are taking the products and they have to pass it on to consumers,” the oil marketer stated.
The source added, “The subsidised ex-depot rate for petrol from NNPC is about N147/litre, but tell me, which depot is selling at that rate today? I know somebody who said he bought from a depot at N182/litre. And he got it at this rate because he did bulk purchases, he bought about 20 trucks.
“And he bought it from one of the major marketing companies. So when you make a bulk purchase at N182/litre, then you can imagine what those who are buying one or two trucks will have to pay for the product.”
“This means that there is hardly any depot you can go to now that you can get products for less than N185/litre. And by the time you buy at N185/litre at the depots, why won’t they sell at N200/litre and above?” the source queried.
