FUEL marketers have declared they can no longer sell petrol at N165 per litre because of what they called the upsurge in transport and logistic costs.
Some of the petroleum marketing union leaders who spoke to our reporter yesterday said it was no longer feasible to sell petrol at the government’s pegged price of N165 in Lagos and Abuja, and in other major cities and still be in business.
“The cost of doing business in the retail outlets has become discouraging. The cost of operations has completely made N165 untrue to happen. We are unfortunately in a situation whereby everything is being politicised,” the president, Petroleum Products Retail Outlets Owners Association of Nigeria (PPROOAN), Billy Gillis-Harry, told THE ICIR.
“There is no way the price of PMS can be sold at N165 realistically. It is a difficult moment because even the purchasing power for those buying the fuel is low. However, we are at the last mile of rendering the service at the last part of the value-chain of PMS supply.
“We as retail outlet owners are ready to sell petroleum products to the teeming Nigerian public. We have no reason why we should not sell to our people. But we must sell at the reasonable price to be in business.
“The money used in buying the 45,000 litres of petrol from depots is borrowed from the banks and is time-bound. So, every retail outlet owner knows that the wise thing to do in this business is to sell out and try to turn around that sale as many times as possible.
“This is because if there is a product and there is money for us to buy it, why won’t we buy and sell? What else are we in business for? Are we going to buy products and keep them? The answer is no! So this is the reality,” Gillis-Harry explained.
The immediate past president of the Major Oil Marketers Association of Nigeria (MOMAN) and Managing Director of 11 Plc, Adetunji Oyebanji, told THE ICIR that Nigerians are still able to buy fuel at the filling stations because of the sacrifices of the marketers.
Oyebanji said, “When you want to take the fuel from the mother vessel, it used to cost $22,000 per day. Now, it is costing almost $50,000 per day. Remember, you cannot even get the official exchange rate so you resort to the black market. This means almost double of your budget.
“At the point we are now, it is whether Nigerians want fuel or not. Nobody is willing to take the fuel at a loss at the current rate. We are merely helping out because the cost of doing this is very high to us as business men.
“The high cost of diesel has impacted negatively also on the cost of transporting this fuel. We are still struggling with cost recovery on our business. In some states, they’re already selling above N165 to still be in business. Part of the reasons we are having this problem is because we insisted on this price band in Lagos and Abuja.”
Already, some filling stations in Abuja, and in Lagos, Niger and some other states are dispensing petrol at between N200/litre and N250/litre, higher than the government-approved retail price of N165/litre, as queues for the product at filling stations worsen.
The price at the black market is as higher as N300 per litre.
In Abuja, the Khalif filling station in Kubwa, dispensed the commodity at N250/litre last Sunday, but displayed N165/litre on its pumps. The fuel attendants calculated whatever number of litres they sold on their calculators based on the N250/litre.
The queues for petrol in Abuja have never ceased since February this year, but grew worse in the neighbouring states of Nasarawa and Niger last Sunday as motorists searched for petrol to move around during the Sallah break.
Many stations were under lock and key despite a promise by the Nigerian National Petroleum Company Limited to make the product available everywhere.
“Marketers are also looking at selling at areas that will help them recover their cost. Many of them are moving their products to the south-east and south-south, where they don’t have problems selling at flexible prices, rather than selling on the N165 price band,” Oyebanji said.
Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.