April 30, 2024

Fuel crisis worsens as acute supply shortage cripples distribution nationwide

Fuel crisis worsens as acute supply shortage cripples distribution nationwide

Fuel supply situation has degenerated nationwide as the Nigerian National Petroleum Company Limited, NNPCL, the sole importer of the product, faces acute limited stock challenges, thereby effectively crippling supplies.

Downstream market sources this morning hinted of challenging days ahead as the hope of adequate wetting of pump stations nationwide appears dim following the national oil company’s inability to immediately resolve the fuel supply debacle.

Although NNPCL Monday discharged some 240 million litres of imported products from five vessels to some five depots, an éxecutive of one of the major oil marketing companies described the supply as “a drop in the ocean.”

“How far can only 240 million litres go when most depots are confronted with product shortages? Only five depots, out of over 100 nationwide, are presently being supplied with product. Others have remarkably low reserves that are not even adequate for their own stations. So, how will they supply products to independent marketers when they don’t have enough to service their own stations?” querried the top Executive.

Findings showed that the five depots that received the 240 million litres from the five vessels on Monday are all based in the South West, leaving the depots in other parts of the country dry, even as what was received by these depots are grossly inadequate to meet the South West product need.

Said another source: “What would have given hope or guarantee assurances is if NNPCL has some ten to 15 vessels about to discharge product. The stark reality is that NNPCL has allowed reserves to deplete to an embarrassing low level before acting and the disruption in the supply chain occasioned by that inaction promises to be with us for many more weeks to come.”

Following the noticeable fuel supply hiccups in some parts of the country last week, NNPCL had dismissed concerns raised by industry operatives on the possibility of another round of fuel crisis, stating that the situation resulted from mere “logistics issues” which it claimed were being immediately addressed.

The situation has since degenerated as the shortage has spread to all parts of the country, leading to 30 to 40 per cent increase in the prices of fuel and effectively crippling business activities nationwide.

Last Sunday, on the directives of NNPCL, over 100 trucks moved fuel from Lagos to Abuja to tackle supply shortage in the Federal Capital Territory, a situation that worsened supply situation in Lagos and other parts of the South West.

Lanre Jimoh, Economist and public sector analyst described the situation as “a big mess.”

“It is unfortunate what the nation is confronting at present when all hands should be on deck to bail the nation out of the economic challenges that we are going through. That turn around maintenance in some European refineries could lead to the hardships we are witnessing in the country now only shows lack of proper planning on the part of those who are responsible for fuel supply. Since over a month ago, Blooomberg and other specialised oil publications reported and analysed the impending turn around maintenance by the European refineries from where most of our fuel imports come from. So, what proactive measures did NNPCL take to avert the embarrassing situation we have found ourselves now? What is the level of reserves now? The situation becomes more embarrassing when it is realised that the state oil company is not giving full disclosure to the public on this sorry situation. It is not only embarrassing but troubling.”

Some top level oil industry source disclosed that NNPCL present reserves may not be able to meet the nation’s fuel supply need for more than the next 72 hours. It is what has given oil market players serious concerns.

Meanwhile, the fuel supply situation remains dire as the product scarcity bites harder, leaving many commuters stranded and businesses in quandary throughout the country.