Oil marketers, under the aegis of the Major Oil Marketers Association of Nigeria (MOMAN) in the country have advised the Federal Government to allow them have access to the dollar at the rate of N306 per dollar instead of the N360 per dollar in other for them to resume fuel importation in the country.
According to the Executive Secretary/Chief Executive Officer of MOMAN, Clement Isong, getting the foreign exchange (forex) at N306 per dollar will lead to an expected open market price of N141 per litre for Premium Motor Spirit.
In his statement, Mr. Isong said, “We don’t have forex at N306 per dollar, Forex at N360 per dollar, which is what we have access to, puts the product into tank at N142. If you then add the distribution cost, the pump price will be N164.’’
In the same vein, the marketers pointed out that there was an urgent need for the Federal Government through its agency, the Petroleum Pricing Products Regulatory Agency (PPPRA), to increase the margins on petrol in order to encourage more investments into the downstream sector of the oil industry.
According to the petrol pricing template of the PPPRA, the margins for retailers and dealers are N6 and N2.36 per litre respectively whereas that of transporters is N3.36.
The Chairman of MOMAN, Adetunji Oyetunji during the event, pointed out the stand of the marketers.
Oyetunji said, “We call on the government to seize the opportunity of these lower oil prices to either give us an immediate margin increase or remove subsidy because today, the landing cost of petrol is much lower than the approved pump price.
‘’So, it gives a unique opportunity to be able to get out of this subsidy business. It happened like that in 2016 when oil price dropped significantly but we didn’t seize that opportunity’’.
It could be recalled that since 2017, the Nigerian National Petroleum Corporation (NNPC) has been the sole importer of petrol into the country after major and independent oil marketers stopped the importation of the commodity due to crude oil price fluctuations, scarcity of foreign exchange, non-settlement of subsidy debt since 2015 and some other challenges.
The Depot and Petroleum Products Marketers Association of Nigeria (DAPPMAN) had criticized the idea of the Federal Government being the sole importer of petrol as this has negatively impacted the industry.
The oil industry stakeholders and financial experts have all been calling for the complete deregulation of the sector especially with petrol as this will help attract more investments in the downstream sector and stop the huge funds which are spent on subsidy annually. The Federal Government in recent times has referred to the subsidy provision for petrol as under-recovery.