No More N650: Fuel Sells for New Price as 1,800 Filling Stations Shut Down, States Affected Emerge

• In protest over an anti-smuggling operation, over 1800 petrol stations were blocked on Monday in northeastern Nigeria
• The event forced drivers to seek petrol from black market operators who saw an opportunity in the ongoing scarcity
• Instead of the N650–N750, Black market traders sold fuel for N1400 per litre to the drivers

Legit.ng journalist Zainab Iwayemi has over 3-year-experience covering the Economy, Technology, and Capital Market.

More than 1,800 filling stations in northeastern Nigeria were closed on Monday, May 24, in protest against an anti-smuggling operation that singled out specific owners, forcing drivers to purchase on the street.

According to Dahiru Buba, the chairman of the Independent Petroleum Marketers Association of Nigeria (IPMAN), this is in response to the Nigeria Customs Service seizing and closing some fuel outlets on the grounds that they were smuggling fuel into neighbouring Cameroon.

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Fuel smuggling business in Nigeria

For years, low-cost gasoline smuggled from Nigeria has been the main source of income for black-market fuel merchants in Cameroon, Benin and Togo.

However, the black market trade was destroyed when Nigeria eliminated its fuel subsidy last year, but since June 2023, the country has capped the price of the product, even if its currency has declined significantly.

Following IPMAN's protests, Customs initially impounded a few of the association's tankers under "Operation Whirlwind" and then released them. Buba reported that more vehicles were confiscated, and a number of petrol stations were closed, leading the operators to close their locations collectively in protest.

He said:

"We wrote to them (Nigeria Customs) again but there were no responses that is why we decided to go on strike," he said, adding that over 1,800 outlets had ceased to operate.

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"This is our business and we cannot be quiet when our members are treated this way."

According to Taraba and Adamawa Customs spokeswoman Mangsi Lazarus, tanker trucks were impounded because they were being used to transport gasoline.

Reuters reported that Black market dealers swiftly capitalised on the shortages in Adamawa's capital city of Yola, selling gasoline for N1,400 ($0.9459) per litre instead of the N650–N750 it was selling for at the pump.

Filling stations ready to adjust pumps again

Legit.ng reported that the cost of importing one litre of fuel by marketers from refineries abroad has increased to N1,026.71 per litre.

This is an increase from the N545.83 per litre NNPC paid to bring the same product in the corresponding period in 2023.

According to the report, the landing cost excludes other additional expenses, such as port-related charges, transportation logistics, and marketers’ margins. When combined, these costs would bring the delivery price at filling stations to nearly N1,052.39 per litre, based on an exchange rate of N1,510 to a dollar, resulting in a differential of N458.71 per litre.

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Proofreading by Nkem Ikeke, journalist and copy editor at Legit.ng.

Source: Legit.ng