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FUEL SCARCITY Looms As Protesting Oil Marketers Stop Fuel Loading At Depot

Members of the Independent Petroleum Marketers Association of Nigeria on Wednesday disrupted loading of petroleum products at private depots in Apapa as well as Ibadan, Ejigbo and Mosimi depots belonging to the Nigerian National Petroleum Corporation.

It was learnt that the marketers picketed the facilities to protest their inability to get products due to a new payment method introduced by the Petroleum Products Marketing Company, a subsidiary of the NNPC.

The Chairman, IPMAN, Ore Depot, Mr Shina Amoo, confirmed the development in an interview in Ibadan on Wednesday.

He said the members of the association blocked the depots with tankers to protest the new payment method.

Amoo said independent marketers were angry because the new payment method, called ‘PPMC Customer Express’, was foisted on them suddenly and the NNPC expected compliance immediately without considering the business interests of many members of the association.

He explained that with the new arrangement, major marketers and very few independent marketers with huge funds could pay for 200 trucks and load them while those who had paid for one or two trucks would be on queue for many months unattended to.

He said, “They must return to the old way of payment, which is also an online payment through Remita.

“IPMAN members held a meeting last night and decided to block loading depots in Ibadan, Ejigbo, Mosimi and private depots in Apapa.

“IPMAN members blocked the depots this morning with their trucks to protest the new payment method.”

According to Amoo, the picketing will continue until the PPMC reverts to the previous payment method.

He said, “The new payment requires various prerequisite documents like renewal of bulk purchase, renewal of licence and several other documents that are not readily available.

“Within few days of this new payment method, some northern big marketers have used the situation to shortchange independent marketers in the South-West. With this, fuel scarcity is imminent.

“PPMC Customer Express mode of payment was introduced without consideration for billions of naira worth of tickets which IPMAN members already tied down in NNPC system.”

Amoo said the new payment method was introduced by the PPMC on February 4, adding that since then, no independent marketer had been able to load.

The NNPC, which has been the sole importer of petrol into the country in recent years, is still being relied upon by marketers for the supply of the product despite the deregulation of the downstream petroleum sector.

Private oil marketing companies have continued to lament that their inability to access foreign exchange at the official rates has hampered efforts to resume petrol importation.

Recall that SCOOPER earlier this week reported that fuel price increase is imminent as the landing cost of Premium Motor Spirit (petrol) imported into the country has risen by 13.34 per cent in one month to about N180 per litre on the back of the increase in global oil prices.

Crude oil price accounts for a large chunk of the final cost of petrol, and the deregulation of petrol price by the Federal Government last year means that the pump price of the product will reflect changes in the international oil market.

Going by the petrol pricing template of the Petroleum Products Pricing Regulatory Agency, the landing cost of petrol rose to N179.67 per litre last Friday from N158.53 per litre on January 7, with the expected open market price (pump price) of the product increasing to N202.67 per litre from N181.53 per litre.

The rising price of crude oil pushed the cost of petrol quoted on Platts to $543.25 per metric tonne (N157.99 per litre, using N390/$1) last Friday from $480.25 per MT (N139.67 per litre) on January 7.

The international oil benchmark, Brent crude, rose to $59.34 per barrel on Friday from $53.70 per barrel on January 7.

Apart from the changes in global crude oil prices, the exchange rate of naira to the dollar also affect the cost of imported petrol.

The devaluation of the naira last year contributed to the significant rise in the landing cost of petrol.

The PPPRA used an exchange rate of N306.90/$1 on January 14, 2020 to calculate the cost of petrol, while N387.63/$1 was used on July 31.

The naira closed at 398.50 against the dollar on Monday at the Investors’ and Exporters’ Foreign Exchange Window, and 480/$1 at the parallel market.

SOURCE: Scooper

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