It seems Nigeria is going to experience another fuel scarcity in just 6 months of this year as foreign banks suspend the credit facilities of petroleum imports.
The situation right now means that importers of petroleum product will not be able to meet up with fuel demand in the short-term as some foreign banks have suspended short and medium-term credit lines to their Nigerian counterparts, due to the failure of marketers to meet their mature foreign currency obligations of over $950 million.
If petroleum marketers was unable to meet up with the foreign currency obligations, the country the country will once again be left with no option but to depend completely on the Nigerian National Petroleum commission (NNPC) for the supply of petroleum products.
Dr Ibe Kachikwu, the General Managing Director (GMD) of the NNPC said earlier this year that the organization that supplies between 45 to 50 percent of the country’s petroleum products was not able to adequately meet the fuel needs of the country. Therefore this has led to fears that Nigeria may yet again encounter another unwelcome episode of fuel scarcity.
Emmanuel Iheanacho, Chariman and Chief Executive Officer (CEO) of Integrated Oil and Gas, while speaking at a forum organized by the Lagos chamber of Commerce said that nothing could work unless marketers had access to foreign exchange within a well-defined and well-organized market.
He added that there could be no solution independent of the restructuring of the nation such that it depends less heavily on imports and in turn consumes less foreign exchange (FOREX). In addition he expressed reservations about the Petroleum Equalizing Fund, which he described as an unnecessary tax on trade, and stressed the need for the pipeline and products marketing company to reduce its involvement in trade.
Fuel shortages in the first 5 months of the year led to long winding fuel queues, reduced economic activity and widespread frustration. In the absence of any government action it appears to only be a matter of time before Nigerians begin to experience fuel scarcity.
Credit: Ventures Africa
