It was also gathered that crude oil refiners were currently
releasing refined petroleum products on credit to dealers from Nigeria,
following the recent unification of the country’s exchange, which boosted the
confidence of operators.
This came as the Independent Petroleum Marketers Association
of Nigeria told our correspondent that they would compete with the Major Oil
Marketers Association of Nigeria and the Nigerian National Petroleum Company
Limited on the importation of petrol, stressing that this would crash the cost
of PMS.
Before the President, Bola Tinubu, removed subsidy on
petrol, the product was solely imported by NNPCL, as other marketers stopped
its imports due to their inability to access the United States dollar.
At the time, oil marketers explained that the NNPCL was
accessing the dollar at a lower rate, which was unfair and did not support PMS
importation by other dealers.
But with the recent unification of the exchange rate, oil
marketers had to join in the importation of petrol and confirmed that the
products should be arriving Nigeria from next week.
Asked to state when the products being imported by major
marketers would start hitting Nigeria, the Executive Secretary, Major Oil
Marketers Association of Nigeria, Clement Isong, replied, “I will simply say
between the second and third week of July”
Isong, however, explained that the NNPCL had made a lot of
fuel imports, as some of its vessels were still on the way to Nigeria.
“Let me say that NNPCL has imported significantly to prevent
the country from running dry. The vessels NNPCL imported are offshore Nigeria,
so they have a significant volume, therefore in all circumstances the country
will not run dry.
“So the options everybody has is that they can buy from
NNPCL ex-depots or they can go and import from Europe or from other places. The
assignment is that you compare your price if you buy from NNPCL or import from
Europe.
“More or less, the taste of the pudding is in the eating. So
do your calculation as the best as you can. But you will only know the full
impact when the product is in your tank. If it goes right, it is then that you
will know how competitive your price is. The more you do it, the more efficient
you become,” Isong stated.
On how marketers were sourcing of forex for imports, the
MOMAN officials dealers were accessing the foreign exchange from banks and
other sources.
“People access forex from different places. Just that it is
easier for some people than others. Some people have strong banks, while others
have other means of accessing forex. So everyone plays on their strength and
ability to access forex.
“And it must be stated that the floating of the exchange
rate is a plus, for instance, some people can go and get credits from their
suppliers, while others have LCs (Letters of Credits), means of borrowing, etc.
“But the most important thing is that there is a unified
exchange rate and that makes people more confident in going to import. There is
no unfair advantage, where in the past some persons have access to low exchange
rates,” Isong stated.
Explaining what he meant by saying some dealers could get
credit from suppliers, he said, “If you have a good relationship with your
supplier, they can give you products on credit. It is a function of the
relationship you have with your supplier.
“Obviously, the way the market works, if you have it on
credit you pay a little bit more.”
Private depots reduce prices
Also speaking on the issue, the Secretary, IPMAN,
Abuja-Suleja, Mohammed Shuaibu, stated that the cost of PMS was bound to go
down in the coming weeks, as imports from marketers arrive in Nigeria.
He confirmed that some private depot owners were already
cutting down the cost of the commodity, lower than the rate being sold by the
NNPCL.
“The sector has been deregulated and, of course, if you have
the power you will go and import. It is not going to be only the major
marketers, independent marketers are also picking interest and there will be
competition
“And, of course, I know that sooner than later, the price of
petrol will be forced down, particularly once the products from marketers start
hitting the country from next week. This is because market forces will now
determine the price.
“It is not going to be solely imported by NNPCL again, for
instance, this week, the private depots reduced their prices, different from
what NNPCL is selling. So there is a reduction lower than what NNPC is
selling,” he stated.
Shuaibu said IPMAN was ready to compete with the NNPCL and
major marketers to force down the cost of petrol nationwide.
“With time there will be healthy competition. We know major
marketers are expecting products in weeks and we will compete with them when
our products start coming. This will further reduce petrol price,” he stated.
The IPMAN official also noted that the consumption of petrol
had dropped, as the purchasing power of citizens to access the commodity had
reduced.
“People are lamenting. The price was raised by over three
times its previous cost, coupled with the economic crisis in the country. So
the patronage has been very, very poor,” he stated.
Last month, the Chief Executive, Nigeria Midstream and
Downstream Petroleum Regulatory Authority, Farouk Ahmed, said some newly
licensed importers of petrol were expecting their cargoes in July.
“The market is open already, we have to follow the
regulations. So we have rolled out policies that are user-friendly. Some of
them (marketers) have already started putting their applications in place. This
is because we don’t want to create a gap.
“NNPCL is slowing down on their importation, so we have to
have someone who is closing up on that gap that NNPCL is creating in order not
to have a shortage in the country.
“But NNPCL is also monitoring the replacements that they
have. We agreed that NNPCL will continue to import until such a time when we
have a critical mass of other importers,” Ahmed had stated in Abuja.