A National Trustee of the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG), Mr Salimon Oladiti, has explained why fuel scarcity may persist in Nigeria, while he identified some factors crucial for a permanent solution to recurring fuel queues and increasing cost of fuel pump price.
Speaking with Tribune Online, Oladiti attributed the recurring fuel scarcity to nonfunctional refineries, instability in the naira to dollar exchange rate, huge reliance on importation of refined products, bad roads, dollarisation of the nation’s economy and activities of smugglers.
Though he noted that government attributed the current scarcity to the naira to dollar rate to import refined crude oil products in the country, Oladiti said lasting solution to fuel scarcity is for the nation’s refineries to work to their capacities.
He described as a pity the fact that the nation depended on importation of refined oil products and failed to fix its refineries thereby engendering local production.
With local refining of crude oil, he noted that the tendency for pump price of fuel to reduce was higher as the Nigeria National Petroleum Corporation Limited (NNPCL) would not have to bear the costs both of exportation of crude oil and importation of refined oil, among other costs.
Noting that removal of subsidy was in order, Oladiti said what was imperative was for government to ensure a strong naira, such that it can withstand price fluctuations in the international oil market.
Describing Nigerians as enemies of themselves as they smuggle refined products to neighbouring countries for their own profit to detriment of fellow Nigerians, he said it was gladdening that subsidy removal has reduced the ratio of smuggling out of refined products.
Oladiti, the former chairman, Petroleum Tanker Drivers (PTD), also said good roads will ease the movement of tankers conveying oil products across the country.
Asked about the resurgence of fuel queues, Oladiti responded: “It is only government that can explain better. “According to them, the issue is instability of naira to dollar rate for importation and it is only NNPCL that brings in the product into the country.
“I believe we will not have any breakthrough on this fuel scarcity until our refineries are working.
“It is a pity that we depend on importation despite we being blessed with natural resources. It is a pity that we depend on importation for virtually everything. No marketer can explain this fuel queues presently because nobody knows what is happening.
“The issue is for government to continue work to make our naira get back to its former glory.
“We are producing the crude oil, we are selling our crude oil internationally and we are now buying refined products. It is like trade by barter. If we can produce locally, it will be helpful.
“If we produce locally, it makes the prices minimal as we will not pay for transportation, insurance. Also, government has to look at some other parastatals demanding various forms of monies as charges from tanker drivers.
“Most of them collect money in dollars and we dollarise our business transactions in Nigeria. The government needs to sit and look at these things. By the time it does that, things will come down and Nigeria will be a place where people can do business easily.”
Asked if the coming on board of Dangote refinery would bring about the desired solution, Oladiti called for caution, noting that a private establishment will always think profit first.
He argued that what was most imperative was a strong naira that can compete in the international market.
Oladiti said: “Dangote is a private company that wants to make profit. It will buy its product from international market.
“Presently the price of crude is about $80 per barrel. The only time we can have cheap petrol is when the price of crude oil come down, the price of refined products will also come down.
“I bought diesel N1,250 per litre which is not profitable to the business. It is killing the business. Now, most people abandoned their tankers because many are running at a loss.”
On subsidy removal, he said: “Even in advanced countries, most members of OPEC, that are very rich, have removed subsidy. Look at our neighbouring countries, virtually all of them removed subsidy.
“The price of petrol in those countries is above N1,000. If we have a strong naira to dollar, the price will come down. But, they put extreme pressure on the naira. “They bastardized the naira but the present government is trying to do everything humanly possible to make sure that they bring down the high rate of naira to dollar.
“We are enemy of ourselves. We are killing ourselves. Subsidy is just to bring the pains down. It is we Nigerians that are taking the products out of the country. We smuggle the products out to neighbouring companies. The product that government is paying additional money to get.
“The price is N500 per litre but the landing cost is N700 and trying to sell the product at N500 per litre. You know how much government has paid for landing cost and some people are carrying that products out of the country and make huge amount of money, huge profit.
“So, we, Nigerians are enemy of this country. If government is paying subsidy and we don’t allow the product out of the country.
“Before we we told we consume about 70 million litres per day, we don’t know the actually figure but as soon as government increased the price that they cannot take it out of the country, what we are consuming just crashed to about 35million litres. We are looking for money at all cost.”
