Oil Sector Insider Reveals Real Reasons for Fuel Scarcity in Nigeria’s Capital

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……..Warns that petrol pump price may hit N1,500 in two weeks time

An oil and gas sector insider has finally explained the reasons behind the lingering fuel scarcity in the nation capital Abuja, warning that residents in the Federal Capital Territory (FCT) would continue to suffer the scarcity unless the federal government of Nigeria intervenes.

At a chat with newsmen in Abuja, the   National President of the Natural Oil and Gas Suppliers Association of Nigeria (NOGASA), Bennet Korie, predicted that in the next two weeks pump price of petrol will hit between N1000 and N1500, unless there is a special government intervention.

According to him, tanker and truck owners are having difficult time with rising cost of delivering products to the northern parts of the country including the FCT.

He said Abuja residents would continue to experience fuel queues not just because of the bridging gap, but also because of bad roads, and fleet maintenance cost.

“The cost of diesel is high. Not just that, the roads are bad, the maintenance is high too. So, you can’t break even. If you go out now, you will see that 75% of filling stations in Nigeria are going out of business. They are getting out of business. It’s not that the fuel is not in the country, but the cost of bringing it here (Abuja) is too high,” he explained.

The NOGASA president confirmed that amid the scarcity, diesel selling at N850 per litre. According to him, except the situation is urgently addressed, the fuel scarcity presently being experienced in Abuja and some parts of the country would continue.

“You use diesel to fuel the filling stations, you use diesel to fuel businesses. The (price) increase is the only way out.  The government should do something fast or in the next two weeks, we are going to buy diesel at between N1, 000 – N1, 500 per liter, if care is not taken,” Korie said.

He stressed that way out of the present situation is that the government should increase the pump price of fuel a little to reduce the money spent on subsidy so that the Central Bank of Nigeria (CBN) can have more forex.

“Diesel is imported and the importers are not getting dollars to import the diesel at the official rate of the CBN, so everybody is going to the black market to get the dollar to import diesel. So, you expect the price of diesel to be high.

“What I am saying is that if you can bring down the use of foreign exchange, it will help other businessmen importing diesel to bring it in at a low price. So, you need to increase the price of fuel so that there can be money for importers of diesel,” the NOGASA president stated.

He explained that efforts by the Petroleum Equalization Fund (PEF) and the Nigeria National Petroleum Company (NNPC) Limited on landing cost had failed to yield the desired result.

“It is not enough because at the time of that increase, diesel was between N300-N400. So now, we are talking about N850. Everybody is suffering. The only way out of this is for Nigerians to take the blow a little so that the rate the country is paying for subsidy will reduce and the money will be used to buy diesel.   

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