Nigerian Petrol Sells at Higher Rates in Neighbouring Countries as CFA Overtakes Naira in Value
- Nigerian petrol is selling at a princely sum in the neighbouring countries of Benin Republic, Togo and Niger Republic
- The situation is attributed to the naira devaluation, which has now made the CFA Franc stronger in value than the naira
- Data shows that smugglers buy petrol at border communities in Nigeria at N580 Per litre and resell at N1,200
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
President Bola Tinubu's naira devaluation has sparked cross-border petrol smuggling to Nigeria’s neighbours.
Findings show that petrol smuggling is flourishing in border communities in Nigeria.
Source: Getty Images
Naira devaluation sparks petrol smuggling
The development has been attributed to the naira devaluation, which has seen the CFA Franc trading higher than the naira, providing incentives for smugglers to sell Nigerian petrol.
Reports say smugglers now besiege petrol stations at border towns, buying the product for between N580 and N630 per litre to resell it for N1,200 in the neighbouring countries of Benin and Togo.
Leadership reports that smugglers buy from filling stations owned by significant marketers along Sango-Idiroko and sell to smugglers at a higher rate despite the Nigerian Customs Service clamping down on fuel smugglers.
Nigeria Customs seizes N205bn worth of petrol
Data shows that Nigeria Customs seized about 1.5 million litres of petrol, the equivalent of 46 tankers, between January and July this year.
The seizures were done in Nigerian states with common borders with the Benin Republic and Niger Republic.
The Customs data disclosed that the naira value of petrol seized in the period under review is worth about N205.4 billion.
The Nigerian government recently lifted ban of sale of petrol in border towns following the removal petrol subsidy.
The service made 955 seizures in the first seven months of this year.
Breakdown of seizures and their worth
The Customs data stated that the seizures in January were worth N13.53 billion, in February worth N132 million, N88.5 million in March, N46.7 million in April, N7,41 billion in May, N89.7 million in June and N7.54 billion in July 2024.
The development comes as the Nigerian National Petroleum Company Limited (NNPCL) has kept mum over the current petrol scarcity in Nigeria, which has seen the price skyrocket to as high as N1,000 per litre in some states.
When Nigerians eagerly wait for petrol from the Dangote Refinery, the scarcity of petrol has caused a rise in transportation costs and other goods and services.
FG, Dangote refinery negotiate petrol pricing
Legit.ng previously reported that there are signs that the Nigerian government’s committee set up to ensure the implementation of crude oil sales to local refineries in naira will discuss petrol pricing from the Dangote Refinery when it rolls out the product next month.
Reports quoted officials among oil marketers and implementation committee members on crude oil sales in naira, under the leadership of the Minister of Finance, Wale Edun, as saying that the panel would be holding meetings on petrol pricing from the $19 billion refinery in the coming days and weeks.
They also reportedly said that the committee would conclude a framework benchmarking how much the plant would pay for crude in naira. The Nigerian government would determine whether to pay subsidies for petrol from the facility to allow Nigerians to buy the product at the market price.
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Source: Legit.ng
