The Independent Petroleum Marketers Association of Nigeria (IPMAN) has issued a warning about potential fuel shortages, citing rising petroleum prices as a concern.
The association highlighted a rift between its members and the management of the Nigeria National Petroleum Company Limited (NNPC). During a press conference in Ilorin, IPMAN’s National Public Relations Officer, Okanlawon Olanrewaju, expressed that the current pricing imposed by the NNPC on marketers is excessively high and could trigger another fuel scarcity.
Olanrewaju stated that the NNPC aims to sell fuel to marketers at N1,010 per liter, which exceeds the prices at their retail outlets. “The challenges we face in the downstream oil sector are significant. The pricing from NNPC is simply unmanageable,” he said. “As the sole off-taker from the Dangote oil refinery, the rates they propose leave us in a precarious position, making it hard to serve the public without being labeled as poor marketers.”
Describing the situation as unacceptable, he questioned the rationale behind the NNPC’s actions. “We have invested approximately N15 billion into NNPC’s account over the past months without receiving our products. This payment was for two to three cargoes at the previous price of N750 per liter, and now they expect us to increase our payments,” he noted.
The association’s leadership has directed members to hold off on further payments until a scheduled meeting next week, indicating a strong stance against the NNPC’s pricing strategy. “We cannot sustain our operations under these conditions,” Olanrewaju added.
He also pointed out that marketers often rely on bank loans with high-interest rates, complicating their financial situation. “This strategy is economically unfeasible for us, especially with the rising interest rates,” he said.
Olanrewaju acknowledged that the directive for members to refrain from operations could lead to fuel shortages. “If we stop picking up products and our supplies run low, there will inevitably be scarcity,” he warned.
Furthermore, he opposed calls for reinstating fuel subsidies, stating that it would disrupt the progress made towards deregulation. “While there may be challenges now, the government’s approach is ultimately beneficial. Full deregulation will foster genuine competition in the downstream oil sector, which is advantageous for the economy,” he argued.
He concluded by asserting that NNPC should not be the exclusive off-taker of Dangote fuel, suggesting that a more open market would lead to reduced prices. “As IPMAN members, we struggle to plan our businesses under the current constraints,” Olanrewaju stated.