NIGERIANS continued yesterday to live under the hobbling impact of fuel scarcity as the product still sold for N100 instead of the official N65.

The development made the Lagos Chamber of Commerce and Industry (LCCI) to call on the Nigerian National Petroleum Corporation (NNPC) to disengage completely from retailing petroleum products.

Despite assurance from the NNPC on Monday that it had made available 18 million litres of premium motor spirit (PMS), otherwise known as petrol, to oil marketers from its Ore Depot in Ondo State, investigations by The Guardian showed that fuel scarcity persisted in Lagos yesterday with filling stations in the state selling petrol at N100 per litre.

The NNPC, in the bid to ease the distribution challenges that had led to the resurgence of queues at filling stations across the country, said on Monday that it was distributing 18 million litres of petrol to fuel marketers to ease of the scarcity.

Group General Manager of the corporation's Public Affairs Division, Levi Ajuonuma, stated this while reacting to media reports that NNPC contractors had suspended importation of products on account of debts owed them by the corporation.

Ajuonuma maintained that the NNPC has a robust stock of petroleum products that could serve the nation for the next 24 days, adding that cargo ships were scheduled to supply the country with enough products all through the year.

Reacting to the worsening fuel crisis in the country, LCCI President, Femi Deru in a statement yesterday in Lagos, said the ongoing acquisition of retail outlets by the NNPC was inconsistent with the proposed reforms in the sector.

In the statement, LCCI wrote: "Retail outlets are the least of the problems in the sector. The commitment of public funds to the acquisition of retail outlets is absolutely unacceptable."

According to Deru, "there should be a strong regulatory institution with clear guidelines to guide investors in the sector and protect the interest of the consumers. The outcome of the adoption of the foregoing is greater private investment in refineries, procurement, distribution and marketing of petroleum products in the economy."

He said that the economy would save the huge sums of money currently being disbursed as subsidy and bridging funds and would be rescued from the massive rent-seeking activities and economic parasites in the downstream sector.

Deru observed that the current fuel scarcity has led to sharp increases in transportation costs, which compounded the challenges of travelling and shot up the cost of product distribution in the economy.

He lamented: "Small and Micro Enterprises who rely on petrol generators had been going through severe stress in the past couple of weeks. There has been loss of valuable man-hours as many people spend several hours on fuel queues.

"It has also led to severe disruptions to traffic in the major cities as a consequence of the obstructions arising from the fuel queues. It has exposed lives and property to fire risk as tendency for domestic storage of petrol increases because of the prevailing uncertainty in supply".

Deru attributed the current fuel crisis to the outcome of alleged ineptitude by the NNPC in the management of the downstream oil sector of the economy.

He said: "The truth is that as long as the NNPC continues to play a dominant role in the procurement, refining, distribution and marketing of petroleum products, the Nigerian economy would remain burdened by the sorry state of affairs in the sector. This situation manifests in profound inefficiency characterised by grave integrity and transparency issues."

In order to deal with the recurring problem of fuel scarcity, Deru stressed the need to address the fundamental issues in the supply chain.

His words: "A critical factor in the current crisis is the fact that public institutions are still the main drivers of the downstream oil sector. This is the paramount obstacle to investment growths, operational efficiency, commercial viability and the transactions integrity in the downstream sector.

"Therefore, the exit of public enterprises in the entire production and supply chain is vital, urgent, imperative and inevitable as a major component of the solution. This is what was intended with the proposed reform of the downstream sector with deregulation and liberalisation as the major planks of the reform."

The reform process, according to Deru, appears to be on the reverse gear. "The truth is that the public sector bureaucracy is not structured to guarantee the efficiency and optimality, which the downstream sector desperately needs. The question is not about the people; it is about the system and the architecture of public institutions in Nigeria," he added.

Deru also expressed concern over the subsidy on imported petroleum products, which he said, runs into hundreds of billions of naira, through the Petroleum Support Funds (PSF); the colossal sum of taxpayers' money spent on the bridging of petroleum products through the Petroleum Equalisation Funds (PEF); and the profound integrity and transparency issues associated with the management of subsidies, the bridging funds and the refineries.


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