The Independent Marketers Association of Nigeria (IPMAN) has told its members to consider shutting down filling stations this week.
The advisory followed a resolution reached last week by NNPC Limited, Major Oil Marketers Association of Nigeria (MOMAN), Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN), Independent Petroleum Marketers Association of Nigeria (IPMAN), security agencies and downstream regulatory agencies to fix pump price at N195 per litre.
Consequently, many filling stations operated by independent marketers could be shut down because their cost price is above N195 per litre and they need to sell higher than that. Their decision to shut down would help them avoid possible sanctions for selling above N195 per litre.
IPMAN’s position: Punch Newspaper quoted the Public Relations Officer of IPMAN’s Ibadan Depot branch, Mojeed Adesope, to have said: “The top management of NNPC, other relevant authorities in the downstream sector of the economy, as well as all the security agents in the country, met on Tuesday, January 31, 2023, to begin the enforcement of pump price of PMS at N195/litre at all the filling stations across the country with immediate effect.“Towards that end, enforcement will commence effective from Monday, February 6, 2023, to enable you to dispose of all your remaining stock on or before the enforcement date.“Members are hereby implored not to purchase products that they would not be able to dispense at N195/litre. The above information should be given wider spread/circulation in order not to get any member caught unawares. You are strongly advised to heed this information.”
Also reacting to the above directive, the National President of IPMAN urged other independent marketers to take note. He said:“The information is in order, because the depots that the NNPC gives products to are selling at a higher price, and IPMAN members will not like to leave their stations idle. And to avoid sanctions, it is better to close your station.“So, what is going to happen in essence is that marketers have to buy products using the NNPCL loading tickets, and if they don’t have the tickets, all they have to do is to close down their stations. You have to buy from the NNPCL in order to sell at the government-regulated price.”
What this means: If marketers are not able to get new stock of fuel at regulated prices from NNPC at lower costs, it means there will be no stock to sell to consumers across the country.
It was earlier reported that the National Operations Controller at IPMAN, Mike Osatuyi said marketers are buying at exorbitant prices from depots and cannot help but sell at higher costs to consumers.
In November 2022, Nairametrics reported that the Deputy National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Zarama Mustapha told Channels TV, that private depot owners were selling to marketers at higher prices than NNPC depots.
This is a result of the cost of transportation from the mother vessel to their private depots because of the escalation of the cost of the dollar. It is instructive to note that private depot owners buy their dollars at the black-market rate.Earlier, the Group Chief Executive Officer of Nigerian National Petroleum Company (NNPC) Limited, Mele Kyari, said that Nigeria’s fuel scarcity challenges are not due to supply constraints. In an interview with NTA last week, he mentioned transportation/distribution challenges as contributing factors to increased costs of fuel in the country.
For the record: The greed factor is prominent in Nigeria’s fuel distribution value chain, according to Mallam Mele Kyari. In his NTA interview, he said Nigerians should understand that there is a presence of greed across the value chain – depots, filling stations, trucks to those encountered on road trips, where all kinds of fees (state, local government) are collected and these add up to logistics costs. He also noted that this greed is not present in the NNPC.