Chief importer of petrol into Nigeria, NNPC says fuel distribution has been disrupted by thunderstorms that affected the ship-to-ship transfer of petrol between vessels, a scenario that has left Nigerians flummoxed. Many however think the coming into the market of petrol from Dangote Refinery may be altering the price dynamics, leading to scarcity.

The queues at fuel stations are getting longer. It started in Abuja a few days ago, hitting Lagos over the weekend. Many stations are shut to motorists wishing to buy petrol and Nigerians who have to fuel their power generators.

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Ironically, diesel is not scarce.

Many reasons have been adduced for this current round of petrol scarcity. Olufemi Soneye, Chief Corporate Communications Officer of the Nigerian National Petroleum Company (NNPC) Limited attributes it to last week’s heavy rainfall which submerged many parts of Lagos.

According to the corporate executive: The NNPC Ltd wishes to state that the fuel queues seen in the FCT and some parts of the country, were a result of disruption of ship-to-ship (STS) transfer of Premium Motor Spirit (PMS), also known as petrol, between Mother Vessels and Daughter Vessels resulting from recent thunderstorm.

The adverse weather [conditions have] also affected berthing at jetties, truck load-outs and transportation of products to filling stations, causing a disruption in station supply logistics.

The 10-hour rainfall in Lagos and some other parts of the country wreaked havoc on businesses and transport infrastructure.

Movement in Lagos particularly was limited, as many roads were flooded for several hours. Says the NNPC spokesperson: Due to flammability of petroleum products and in compliance with the Nigerian Meteorological Agency (NIMET) regulations, it was impossible to load petrol during rainstorms and lightning. Adherence to these regulations is mandatory as any deviation could pose severe danger to the trucks, filling stations and human lives.

Similarly, the development was compounded by consequential flooding of truck routes which has constrained [the] movement of PMS from the coastal corridors to the Federal Capital, Abuja. The NNPC Ltd is working with relevant stakeholders to resolve the logistics challenges and restore seamless supply of petrol to affected areas.

However, many industry watchers feel differently, as they attribute the current scarcity of petrol to the possibility of the fuel from Dangote Refinery selling below the current pump price, thereby putting marketers in a position of uncertainty.

With no clear price direction, the industry stakeholders believe that marketers are not willing to take up products that may be stuck within the likely event of a wide disparity.

Aliko Dangote, founder of Dangote Refinery, is certain petrol from his refinery industrial complex will hit pumps this month. We had a bit of delay, but PMS will start coming out by the 10th to 15th of July. But then we want to keep it in the tank to make sure that it settles. So by the third week of July, we’ll be able to come out to take it into the market, he told members of a Senate delegation led by Godswill Akpabio who was on a tour of the facility.

Although petrol from Dangote refinery was initially projected to hit the market last month, the date had to be changed by the company.

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The industry watchers said that marketers do not want a repeat of their experience with diesel only a few months ago. At a time when fuel stations were dispensing diesel at ₦1,900/litre, Dangote Refinery launched into the market with ₦1,150/litre. Many fuel stations struggled to close the price gap.

A similar scenario may play out if marketers do not plan well, says the market watchers. The question they are asking is: What will be the ex-depot price of petrol from Dangote Refinery?

Adewole Ojo

Adewole Ojo is the Editor-in-Chief of Meiza Nigeria. He can be reached on adewole.ojo@fourpoints.ng.