Filling Stations to Adjust Prices as Depot Prices Rise, NNPC Faces Cash Challenges

• The Nigerian National Petroleum Company Limited (NNPC) may halt petrol imports following a vast debt strain
• The company informed marketers that due to the financial challenges, it may not sustain petrol imports
• The development may lead to an increase in petrol prices above N1,000 per litre at the pumps

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

Petrol may rise above N1,000 per litre at filling stations as the product cost in some private depots has risen to between N920 and N950 per litre.

The development follows protests by Nigerians in Abuja on Monday, September 2, 2024, over the lingering petrol scarcity nationwide.

Nigerians demand sack of NNPC boss

The protesters demanded the resignation of Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPC).

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According to a report by Punch, NNPC informed oil marketers about the financial challenges regarding petrol imports.

NNPC’s financial challenges raised concerns among dealers, who expressed worry over the national oil firm's impending halt in petrol imports.

NNPC admits $6 billion debt

NNPC’s spokesman, Olufemi Soneye, stated that the company faces financial strain. The firm is the sole importer of PMS into Nigeria and handles subsidies on the commodity, which amount to trillions of naira.

Soneye disclosed that NNPC faces financial challenges due to PMS supply costs affecting supply sustainability. It acknowledged recent reports regarding its significant debt to petrol suppliers.

It was reported that the company owes about $6 billion in outstanding debt to suppliers across the globe.

It, however, assured Nigerians that it remains dedicated to its role as the supplier of the last resort, ensuring national energy security in line with the Petroleum Industry Act (PIA).

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NNPCL increases petrol price by 37% as Dangote rolls out product nationwide

NNPC may not continue petrol imports

Meanwhile, marketers said NNPC officials informed petrol dealers of the development, stating that this may lead to a further hike in petrol pump prices in the coming weeks.

The National Publicity Secretary of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Ukadike, said that only NNPC Trading imports petrol and that the company has told marketers that they can no longer sustain imports.

Marketers, NMDPA officials disagree

The development comes as private depots sold petrol for between N920 to N950 per litre, contrary to the position of the Nigeria Upstream and Downstream Petroleum Regulatory Authority (NMDPRA) that depots were meant to sell petrol at the stipulated price.

NMDPRA spokesman George Ene-Ita disclosed that the petrol price reports that NMDPRA gets from its officials at depots differ.

Findings reveal that independent marketers owned filling stations and sold nearly N1,000 per litre of petrol.

The National Vice Chairman of IPMAN, Hammed Fashola, faulted NMDPRA, saying the regulator was not sincere.

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“Debt to petrol suppliers”: NNPC finally explains real reason for petrol scarcity

Meanwhile, some Nigerians have expressed optimism, saying that the petrol situation in Nigeria will ease following the Dangote refinery's coming onstream.

Legit.ng earlier reported that the Dangote Refinery is ready to roll out petrol and that the NNPC will be the sole distributor of the product.

Minister charges NNPC to sell petrol N1,000 per litre

Legit.ng earlier reported that the minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has said that the Nigerian National Petroleum Company Limited (NNPCL) must sell petrol above the landing cost to stop smuggling.

Lokpobiri disclosed this at the 2024 Energy and Labour Summit in Abuja, pointing out that selling imported petrol below the landing cost motivates smuggling activities.

He disclosed that smuggling will continue if the national oil firm imports PMS and sells it to marketers at about N600 per litre.

Proofread by Kola Muhammed, journalist and copyeditor at Legit.ng

Source: Legit.ng