ONCE more we are at the verge of petroleum products scarcity without knowing what led us to it. The relative supply stability of the past few months is being threatened by the opaque practice the Petroleum Products Pricing and Regulatory Agency, PPPRA, is instituting, supposedly in the public interest.
The introduction of the Sovereign Debt Instrument, SDI, some marketers allege, is being manipulated by the PPPRA to allocate importation of products to companies without facilities.
PPPRA is also accused of paying billions of Naira to these companies in the past few months as import subsidy. One of the things to worry about in this regard is that government is throwing money at companies without the capacity to meet their obligations to the Nigerian public in a critical area as petroleum products supply.
Companies that feel left out in the allocations that were said to be mostly for political patronage are asking government to publish a list of the beneficiaries of the allocation. Most of these companies are unknown and have no pedigree in supplying petroleum products. Some of them are said to have been unable to exhaust their second quarter allocations while they got more allocations when the third quarter slots were farmed out in the same favoured order.
Will they be able to cope with meeting the petroleum products needs of Nigerians? It is doubtful. There are more things to cause concern. The consequences, if they fail, would be too damaging to contemplate in an economy that is increasingly unable to absorb further shocks.
The core importers of petroleum products complain that their huge investments in tank farms and hiring of experts and debts incurred during the collapse of oil prices in the international market, would be adversely hit by their exclusion from importation of products.
How are they supposed to repay the debts they incurred in expanding their facilities? How would the ad hoc policies on product importation affect long term projects in the industry?
The worries about the impact of the new regime on petroleum product increase with the realisation that PPPRA is under the unwieldy control of the Presidency. Nothing can be done immediately about that, other than reminding the Presidency about the lurking dangers of scarcity. Anything that can be done to avoid that would be in the interest of the greater majority of Nigerians.
â€œAny insinuation to the effect that the Minister interferes with the day_to_day running of either PPMC or the PPPRA is not only unfair, but a blackmail which will not be tolerated,â€ Dr. Levi Ajuonuma, General Manager, Public Affairs of the Nigerian National Petroleum Corporation, NNPC,Â said in a manner that absolves the NNPC of the failure of the PPPRA if there is scarcity.
There is further source of possible scarcity from the threat of the Petroleum and Natural Gas Senior Staff Association of Nigeria, PENGASSAN, to embark on strike in Abuja, over the poor state of roads in certain parts of the country.
We can do without these disruptions, if government paid a little more attention to how its policies affect Nigerians.