DESPITE receiving N413 billion in subsidy claims, petroleum marketers may have suspended fresh importation of petroleum products, Daily Sun learnt yesterday.
The development, according to some importers, who pleaded not to be named, may have been responsible for the unabated fuel scarcity nation-wide.
Indeed, some marketers told Daily Sun yesterday that the scarcity could linger till February 2016. Specifically, they said the alleged plan by the Federal Government to remove subsidy on petrol next year and commence full deregulation by January 1, is already causing ripples among marketers.
The marketers, who claimed to be in full support of the deregulation of the downstream sector, lamented that the secrecy surrounding its implementation and take-off date is already causing uncertainty within the sector. “Marketers are not against deregulation. But deregulation must be planned for. It must not be a hasty decision. We are entities that invest a lot in importation of petroleum products. If a decision that is to affect us must be taken, then, we must be taken into consideration. For now, uncertainty pervades the sector,’ ’an importer said.
A source said Nigerians are not considering the vagaries involved in deregulation. There are speculations that with deregulation, a litre of petrol would sell for N97, which is a possibility on one hand. But considering the current price of crude oil which sells for about $38 per barrel, what if this price slides further in the weeks to come and the permutation declines to less than N87 for a litre, who bears the loss?
The source said all these certainties surrounding the downstream sector have further dealt a debilitating blow on the current fuel scarcity. But the Minister of State, Petroleum Resources, Dr. Ibe Kachikwu, in a swift response to douse tension on the plan to increase petrol price to N97, denied such intention by government. Kachikwu, who is also the Group Managing Director of Nigerian National Petroleum Corporation (NNPC), however, advised Nigerians to dispel such insinuations
He said the discourse has long left the realm of subsidy removal to a more scientific price modulation approach which entails an elastic price mechanism regime to be reviewed periodically to reflect the prevailing international price of crude.
He explained that when operational, the novel price modulation system will place a N97 per litre cap on the price of fuel to ensure that Nigerians are insulated from the vagaries of the global crude price.
“I did not say that refined petroleum products will sell for N97 per litre next year. I said between a band of N87 and N97 we are going to be looking at prices and today, the prices are largely close to N87. So, there is no need to change the price,’’he said
The minister noted that to determine the price of petroleum products in future, the Petroleum Products Pricing Regulatory Authority (PPPRA), will undertake quarterly review of the crude market situation.
“I have not put a static figure. PPPRA will have to do the calculation to be able to announce what price of PMS (petrol) will sell for in January; but we do not anticipate any major shift because of the price of crude today,’’ he noted