IPMAN blames petrol scarcity, varied pump prices on NNPCL’s system breakdown, B2B, transactions

By Abiodun OBA, Tayo ABIOLA

The seemingly worsening petrol scarcity in the country has been attributed to system breakdown in the Nigeria National Petroleum Company Limited, NNPCL and the thriving Business2-Business, B2B, transactions amongst the petroleum marketers in favour of the major marketers.

The Independent Petroleum Marketers Association of Nigeria, IPMAN, also hinted that the system breakdown may have led to an undue advantage for the major marketers as independent marketers no longer have direct access to imported consignments of the product at the depots at the stipulated depot prices.

IPMAN, has explained that petrol pump prices are higher at its stations because members source their products from the open market.

The Public Relations Officer, IPMAN, Chief Chinedu Ukadike who disclosed this pointed out that because NNPC Retail’s portal has been down, members have been unable to obtain products directly from the government-owned oil company.

Chief Ukadike pointed out it is impossible for independent marketers to sell below ex-depot price or without adding the cost of transportation, wages of workers and other logistics costs.

“We source our product from the open market. We buy from tank farm owners, major marketers and depot owners. For some time now we have not been able to get products from the NNPC because the portal is down. It is undergoing an upgrade and we have not had any access to it. Without access, you cannot get a product.

“Also, they are updating licences for marketers, and we have been urging them to increase the speed. You must understand that the sector is liberalised and sell as you buy. Presently, we load between N650 to N700 per litre. By the time you add the cost of transportation and others, you will realize how difficult the sector is for independent marketers.

“We are just managing to keep our stations open so that we don’t go out of business and have to sack our workers. You must also understand that prices are determined by demand and supply. Currently, the demand is higher than supply and that will naturally lead to an increase in price,” he added.

Also speaking on why IPMAN-operated stations were selling at higher pump prices, the Chairman, IPMAN Aba Depot, Maxi Oliver Okolo said independent marketers were loading from privately owned depots at N800 per litre.

“It’s impossible for us to sell below that amount and that is why we have asked the government to intervene and ensure that we also get our products directly from NNPC depots. That is the only way we can compete and remain profitable.

“Many of our members have shut down their stations and sent their workers away because we cannot no longer cope with the harsh business environment”, he added.

Speaking on why filling stations operated by major marketers continue to dispense despite the disruptions, the CEO, Major Energy Marketers Association of Nigeria, MEMAN, Mr Clement Isong said collaborations amongst members including product swaps have kept their stations wet.

Isong explained that “The advantage we have is that we share logistics in Apapa, which is an excellent platform to work with. They call it the Apapa hub. All our members have depot facilities in Apapa and so logically, over time, we learned to work together for the efficiency of the Apapa hub.

“So, when we have scarcity like this because we know ourselves, we are an old association, I think we are the first, we share not just logistics but products. We do what we call product swaps. So, if I run dry in my depot, I can go and take from another MEMAN company depot and later when I have products, I can give him back the product that I took from him.

“The advantage of this is that we all can focus on keeping our stations wet. We have the key stations in all the key cities in all urban areas in Nigeria. If we can keep our 3,000 stations wet, we think that with an efficient system of transportation, the queues will abate before the weekend”, he added.

Attempts to get a reaction from the Spokesman of NNPC Limited, Mr Olufemi Soneye were unsuccessful as his known phone number was switched off. There was also no response to messages sent to him.

With continued shortages and queues at petrol stations, pump prices are now settling at higher ranges across independent marketers and some major marketers.

In Lagos and Abuja gaps between prices at major marketers’ filling stations and those of independent marketers are widening with major marketers maintaining relatively stable prices while independent marketers have adjusted their prices upwards by between 20 and 30 percent.

While major marketers are selling at an average of N605 per litre, the independents are selling at an average of N730 per litre.

However, findings also show extreme cases, both low and high, as a few major marketers are selling below N600/litre while some are selling up to N900/litre in the outskirts of major cities.

Also, while black market prices went as high as N1500/litre the operators are still getting significant patronage reluctantly as long queues persist in petrol stations across the cities.