Dr. Kachikwu & Dr. Baru

In a press release issued today, members of the Depot and Petroleum Products Marketers Association (DAPPMA) have denied allegations that they were involved in hoarding petroleum products, resulting in the current scarcity. DAPPMA blamed the scarcity on the following reasons.

  • The Nigerian National Petroleum Corporation (NNPC) is currently the sole importer of petrol into the country.  DAPPMA stated that this was due to the petrol having a fixed price of N145, despite the current price being N17o per litre.
  • The NNPC thus currently absorbs this subsidy.
  • The corporation currently meets this demand through the Direct Supply Direct Products (DSDP).  Due to price challenges, some operators have been unable to meet their quota to the NNPC. This is the main cause of the current scarcity.
  • Due to hurricane Katrina, the international price of petrol has hit $600 per metric tonne, and has not gone since then.
  • Exchange rate for petrol imports is N306 per dollar, while banks charge 25% interest rate.
  • The NNPC being the sole importer, has left it with distribution challengers since marketers own 80% of the receptive facilties and retail outlets in Nigeria.
  • DAPPMA members are currently being owed PMS orders in excess of 500,000 metric tonnes (equivalent of 800 million litres of petrol) despite having paid in advance. This is enough to meet the country’s needs for 19 days at a consumption rate of 35 million litres per day.

 

Here is a copy of the press release.

 

 

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via onome.ohwovoriole@nairametrics.com

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.