By Adedapo Adesanya
The distributors of petrol and other fuels in Nigeria said they can no longer sustain the distribution of the products nationwide as the price of diesel used to power their trucks is now N1,100/litre in many locations.
The marketers, under the aegis of the National Oil and Gas Suppliers Association of Nigeria (NOGASA), raised the concern in a statement on Tuesday.
The president of the group, Mr Benneth Korie, said that diesel has witnessed incessant hikes in recent months, lamenting that the development has been worsened by marketers’ inability to secure cheap bank loans that will enable them to restock and sell petrol at the current pump price of N617/litre.
According to him, “NOGASA is worried about the ugly development and trying to understand why prices of diesel are going as high as N950 to N1,100 per litre in the market with a view to moderating the prices and shocks in the economy.”
This could contribute to an impending rise in petrol prices as crude prices have risen to a new high of $95 per barrel in the international oil market.
Petrol marketers have called for urgent intervention by the federal government to arrest the fast increase in the pump price of diesel to prevent an imminent distribution crisis.
The boost in oil prices was spurred by the growing imbalance between demand and supply as the Organisation of the Petroleum Countries and its allies (OPEC+) restricted daily production over the last few months.
For Nigeria, the rise in prices means the average Nigerian will pay more to buy petrol at the retail stations for domestic and commercial use, as the cumulative cost increases whenever there is a rise in crude oil price.
Following the removal of fuel subsidies by President Bola Tinubu in late May, oil prices are at the mercy of market forces. Although the country has been able to keep a lid on increasing prices in recent months, this latest development could force an uptick in price review.
Currently, Nigerians pay between N568 and N620 per litre for petrol in the country and less than N10,000 for a 12.5 kg canister of Liquified Petroleum Gas (LPG), also known as cooking gas. The last price review was three months ago and has put strains on each distribution level, from the producers to the distributors to the retailers.
