Petrol Retailers: Fuel Prices High Due to Members’ Inability to Get Products Directly from NNPC

•House investigates resurgence of fuel queues, alleged return of subsidy

•FG committed to restoring normal products supply, says Lokpobiri

Emmanuel Addeh and Adedayo Akinwale in Abuja

The Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) yesterday said that prices of petrol will be lesser if members can get products directly from the Nigerian National Petroleum Company Limited (NNPC) without the use of middlemen.

Speaking on Channels Television, the National President of PETROAN, Dr Billy Gillis-Harry, stated that buying from private depots will always see members the association buy at higher prices, which will further reflect at the pumps.

Gillis-Harry explained that to prevent a recurrence of the ongoing scarcity which the NNPC has partly blamed on transhipment issues, Nigeria should have enough local products reserves to last at least 15 days as well as able to predict thunderstorms that disrupt smooth operations.

“I think that the matter is being tackled very frontally by NNPC and we will get to the end of it. But however, my point is that we should not let this situation keep cropping up and creeping on us without any notice. We should be able to have some sort of data to be able to guide us in getting this situation completely eliminated,” he argued.

Independent petroleum marketers have continued to sell the product above the band set by the government, blaming third party participants. While NNPC filling stations still sell at lower prices, from N570 to N617, in Lagos and Abuja, others who get from private depots have had prices rise to as much as N900.

Gillis-Harry said the cost of logistics was soaring by the day because diesel used by trucks has also become scarce and expensive, but said that selling a litre for as high as N1000, was pure profiteering.

“NNPC has not changed their prices for us. We still buy at the price that is given to us from them. However, we must always realise that if we do not get the product directly from NNPC and we are going to get it from depots and are also struggling to do everything to get products out in the market, the prices will not be the same,” he added.

The PETROAN chief said forex shortages had also impeded the importation of petroleum products into the country hence limiting the full operationalisation of the deregulation of the sector.

“ If we have products from NNPC, we should be able to sell our product between N620 and N650. If we source it from other depots that also have to make additional expenses, it is clear for us to understand that we do not expect them to sell us at the price that NNPC is giving.

“They make additional expenses to land it at that particular depot. And then, from the depot again, you have to make additional logistics expenses, which is sometimes never straightforward. Because you see prices fluctuating as to the cost because of distance and all of that.

“So a station that has landed product in their station, say at N690 or  N700, will certainly make a sale that will be able to guarantee restocking. And this is what is important to know,” he argued.

He stated that it is because of the high price of diesel that PETROAN is advocating for penetration of Compressed Natural Gas (CNG) to ensure oil tankers are all fitted with CNG facilities at an affordable price.

He also advocated that crude oil should be sold to local refineries in naira to reduce the impact of the high exchange rate to the dollar.

“As long as we are talking about ship-to-ship, that’s because it’s happening in the high seas. And weather conditions are very difficult to be able to study these vessels.

“ Be that as it may, I would expect that the most, the highest price, for instance, in the areas where the depots operate, such as Delta, Calabar, Rivers State, should be anything between N620 to N680 maximum,” he argued.

Meanwhile, the Minister of State Petroleum Resources, Senator Heineken Lokpobiri, has urged Nigerians to be patient while the federal government sorts out the current nationwide scarcity.

In a statement on X, Lokpobiri stated that a federal government team was working round the clock to resolve the current issues.

“I understand the frustration many of you are feeling due to the fuel queues in cities such as Abuja. Recent flooding on the trucking route and unavoidable logistical challenges due to weather concerns have temporarily disrupted our distribution chain.

“I assure you that our dedicated team is working round the clock to resolve these issues. We are committed to restoring normal fuel supply as quickly as possible. Thank you for your patience and understanding during this time. Together, we will overcome these challenges,” he stated.

Meanwhile, the House of Representatives has resolved to carry out a forensic investigation into the allegation of importation of substandard products and high-sulphur diesel into Nigeria, resurgence of fuel queues and the return of petrol subsidy.

The House also resolved to probe unavailability of feedstock for downstream domestic refineries, disruption of distribution of petroleum products, unfair subsidisation of petrol and other petroleum products racketeering and favouritism in the Pro Forma Invoice System (PFI) regime.

The Green Chamber further resolved to probe the indiscriminate issuance of licenses and importation of refined petroleum products, alleged return of PMS price intervention, allegation of product unavailability to marketers from NNPC Retail, endless shifting of timelines for refinery rehabilitation and the ‘nefarious’ activities at petrol depots.

The resolution of the House was sequel to the adoption of a motion of urgent national importance moved at the plenary yesterday by Hon. Billy Osawaru and Hon. Phillip Agbese.

Presenting the motion, Osawaru said in recent times there had been a resurgence of fuel queues in petrol stations, with allegations of high cost of PMS and non-availability of feed stock for downstream domestic refineries in Nigeria and disruption of distribution of PMS products.

He said there was also an allegation of unfair subsidisation of PMS and other petroleum products which negatively affects competitiveness in the sector.

Osawaru added that there were also allegations of racketeering and favouritism in the PFI regime, indiscriminate issuance of licenses and importation of refined petroleum products.

He noted that with the alleged return of PMS price intervention with its impact on the domestic market, there were also allegations of product unavailability to marketers from NNPC Retail.

The lawmakers said the endless shifting of timelines for refinery rehabilitation, the nefarious activities at petrol depots have affected product distribution and caused scarcity.

Osawaru stressed that there was also the use of middlemen in trading and has negatively affected domestic crude supply.

He decried the indiscriminate issuance of licenses, unavailability of laboratories to check adulterated products and the influx of adulterated products into the country as well as allegation of non-domestication of profits realised from crude marketing sales in local banks.

Osawaru expressed worry about the failure of the regulators to enforce compliance with standards that would help achieve the growth of downstream sector and the lack of support to local crude refiners, issuance of import license, despite local production.

The House resolved to: “Mandate the House Committees on Petroleum Resources (Downstream) and (Midstream) to carry out a legislative forensic investigation into the resurgence of fuel queues in petrol stations, allegations of high cost of PMS.

“Unavailability of fuel stock for downstream domestic refineries, disruption of distribution of PMS products, unfair subsidisation of PMS and other petroleum products racketeering and favouritism in the Pro Forma Invoice System (PFI) regime.

“Indiscriminate issuance of licenses and importation of refined petroleum products, alleged return of PMS price intervention, allegation of product unavailability to marketers from NNPC Retail, endless shifting of timelines for refinery rehabilitation, the nefarious activities at petrol depots,” among others.

The Green Chamber also resolved to probe allegations of non- domestication of profits realised from crude marketing sales in local banks, abuse of the PFI regime, importation of products already being produced in Nigeria and use of international trading companies to resell fuel stock to local refineries.