Rita Odafe
The Independent Petroleum Marketers Association of Nigeria (IPMAN) explains the difficulties oil marketers encounter when trying to import petrol, unlike the Nigerian National Petroleum Company (NNPC) Limited.
IPMAN highlights that the high landing cost per liter of Premium Motor Spirit (PMS), also known as petrol, makes it financially unfeasible for petrol marketers to engage in importation as effectively as NNPC does.
IPMAN’s National Operations Controller, Zarama Mustapha, mentioned on Channels Television’s Sunrise Daily program that the current landing cost of PMS exceeds ₦1,200 per liter, excluding other expenses such as marketers’ margins, transportation, and logistical costs.
He noted that while NNPC sells to marketers at about ₦565 per liter, a considerable subsidy of nearly ₦600 to ₦700 per liter exists at the moment, indicating that there is under-recovery of costs.
The recent resurgence of petrol subsidy has been a prominent demand of activists protesting against governance issues in Nigeria, notably hunger and food price inflation.
President Bola Tinubu, in a national address, acknowledged the removal of fuel subsidies and the elimination of multiple foreign exchange systems to facilitate economic growth.
While recognizing the legitimacy of the protesters’ demands, Mustapha from IPMAN expressed skepticism about the government’s capacity to meet such demands, given the current economic challenges facing the country.
Nigeria, being Africa’s most populous nation, grapples with energy crises due to its inoperative state-owned refineries, relying heavily on imported refined petroleum products, primarily imported by NNPC.
Frequent fuel shortages plague the nation, with petrol prices skyrocketing since the subsidy removal in May 2023, exacerbating the burden on citizens who heavily rely on petrol for transportation and electricity generation.
The unified forex windows instituted by the government led to a significant depreciation of the naira against the dollar, causing soaring inflation rates that have directly impacted the prices of food and essential commodities, further burdening the populace.
