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How To Make Fuel Scarcity, Price Hike Go Away In Less Than A Week – Nigerian Independent Petroleum Marketers, IPMAN

December 5, 2022

Premium Motor Spirit (PMS), also known as petrol has been scarce with only a few fuel stations selling the product, some for as much as N400, over 100 per cent increment.

Amid the daily public outcry over the persisting fuel scarcity and progressive hike of the price of the product in Nigeria, the Independent Petroleum Marketers Association of Nigeria (IPMAN) has said that it has told the Nigerian government what to do to end the scarcity and bring down the price.

Premium Motor Spirit (PMS), also known as petrol has been scarce with only a few fuel stations selling the product, some for as much as N400, over 100 per cent increment.

Speaking with SaharaReporters, the National President of IPMAN, Chinedu Okoronkwo, said the government should as a matter of urgency decentralise the supply system of fuel, give independent marketers their distribution sources and the scarcity of the product and its attendant price hike would be over in less than a week.


Okoronkwo pointed out that the current fuel scarcity was mainly caused by two factors – problems with distribution and dollar to naira exchange rate.


According to him, on the issue of distribution, there are Nigerian National Petroleum Company Limited (NNPCL) depots that the product could not get to because of vandalism. And each time fuel is pumped to those depots, over two-thirds of the fuel is lost.

“So, it is not advisable for them to continue with that. And these private transport owners have taken over the importation of this product from the NNPCL. The NNPCL will bring the mother vessel, then they will go with the daughter vessel to fetch the product.


“It is done at a cost and some of these are in dollars, like that of payment to the Nigerian Maritime Administration and Safety Agency (NIMASA), the Nigerian Ports Authority (NPA) and other cost charges are dollarised,” he said.


The IPMAN boss said that following the recent spike in the dollar to naira exchange rate from N500 to about N700, even N800, it is never easy. He noted that marketers cannot be blamed because they are business people, and “so when they bring it, they add all those charges and that will reflect in the market.”


However, Okoronkwo maintained that “there is an answer to all these”. “NNPC is the sole importer and they are the people we have an agreement with, that is, independent marketers, major marketers and depot owners,” he said.

According to him, within the supply chain, “we control over 80 percent of the activities in that sector, that is to say, filling stations. Our member stations are about 80 percent of all the stations we have in Nigeria; leaving only 20 percent to the NNPC, depot marketers and depot owners.”


He continued, “But for us to access this thing (fuel), we have to pass through these people that have depots who must have gone to pick this product and must have embedded their cost in it. But for us in IPMAN, we know, despite the NNPC pipeline vandalism and everything, we will be accessing the product. They have not changed their own price of giving this product because the subsidy element is still there.


“That is why we are trying that you (the government) can designate 10 depots or about 15. We have five zones. Some of those zones have five depots. Ordinarily, those depots are not working, so you can direct the Eastern zone for instance to go to Port Harcourt depot, your product is there, and bring out the amount they will pay, after all, we are not asking them to give it to us on credit.”


He said that if there are a few handling charges for the owners of those depots, as there are templates for everything, the independent marketers can pay. “We can also pay those that are bringing those daughter vessels. We can also have an agreement with the likes of Pinnacle because Pinnacle oil is midsea.

“These are the things we can do to ensure that my members, by the time they can access this product seamlessly, I tell you, in three to four days, you won’t see any scarcity again. But I think the NNPC has heard us and they are doing something to see if they can help us in this direction. I think that is what will permanently solve this product issue before the full implementation of PIA, especially in the area of subsidy and all these elements.


“Separate IPMAN from other operators in the system. Give us our own. Just like when you have children, putting their food in one bowl, the senior ones will not allow the junior ones to get anything. They will just overpower them. That is what is happening.”


He insisted that by the time the government gives the independent marketers their own depots and every marketer has theirs, monitoring will be easier and the issue of diversion will end.

“So, what we are saying is, decentralise the supply system and give us our own. Don’t put us into the same bucket with all these other operators,” he said.

When asked if the independent marketers determine their supply price on a litre basis, Okoronkwo said, “We don’t calculate on a litre basis because if we do that, nobody will be in the business because no marketer will make any gain after paying salaries, transportation and other things. But if the product is available, we can only leverage the volume because we can get up to 20 trucks in a month, even if the gain is not much. But when you don’t have the product and in a month, you sell maybe one truck, it is not a good business.”

The current fuel scarcity has directly affected transportation fares, contributing to the rising cost of food items and other commodities in the markets across the country, thereby worsening the cost of living. A recent report done by the National Bureau of Statistics said no fewer than 133 million Nigerians live in deep poverty.