The devaluation of the naira that has now pegged the exchange rate of the naira between N282-284/$ from the previous N199/$ is likely to lead to an increment in the pump prices of petrol as oil marketers debt grew to N266 billion against the N190 billion under the old rate.
Oil marketers said the NNPC is under-cutting the market because of the price it is selling the product. It sells at N 111 for a product that is costing about N126-127 per litre. They said if they import and sell at about the price the NNPC is selling, they would run out of the markets.
Another reason the marketers gave for not importing is that the process of getting the forex is so slow and they are not getting the needed volume of forex that could have allowed them to import. They said government should change the template for petrol so that they can sell under the regime of appropriate market forces.
According to National Daily investigation, government’s insistence that they use the current exchange rate to settle the legacy debts will mean that the marketers will have to look for the differential which is about N76 billion in order to liquidate the debt.
“These businesses were transacted almost two years ago and now, they want us to use the exchange rate of N282 to a dollar to clear these matured obligations that were transacted at the rate of N200. Government is asking us to bring the differentials to make up the difference. That will kill the downstream sector in Nigeria and meanwhile, the interest is piling up at the offshore banks”, a source said.
Already, fuel supply from the Nigerian National Petroleum Corporation (NNPC) to marketers, has become unsteady, as some marketers get intermitent supply and days of dryness.
According Nojeem Korodo, chairman Lagos Zonal Council of the Nigeria Labour Congress and Chairman of the National Union of Petroleum and Natural Gas association (NUPENG), the NNPC has stopped supplying products to it depots in the hinter land adding that everyone is the dark as to what is happening to the depot.
He said all the supplies are diverted to private depots in Lagos and because of this, many other stakeholders that would have ordinarily been encouraged to import, are not doing so because the NNPC supplies their depots and has abandoned its own.