Marketers blame NNPC for high kerosine price

Despite assurances from the Nigerian
National Petroleum Corporation (NNPC) that
its three refineries are now producing
Automotive Gas Oil (AGO), also known as
kerosene, the price of the product has
remained high, which has been attributed to
scarcity of foreign exchange, deregulation of
the product and diversion to aviation fuel.

The product, which was sold at less than
N150 per litre about three months ago, has
increased to about N200 to N250 a litre. The
Guardian gathered that the price of the
product already goes for NI88 per litre at
NNPC depots; thereby forcing retailers to sell
at exorbitant prices, taking advantage of the
fact that kerosene has been deregulated.

Many of the filling stations visited by The
Guardian were not selling the product, while
others have increased its price. However,
Ndu Ughamadu, Group General Manager and
Group Public Affairs Division of NNPC
insisted that the country’s three refineries
have continued to supply about 4.8 million
litres of kerosine daily.

This, he said, is in addition to the one cargo,
which the corporation daily imports to
compliment the output from the refineries.
Some marketers, who spoke with The
Guardian, said the price of the product is
high due to the inability of petroleum
marketers to import, thereby depending
solely on supplies from NNPC.

According to them, the scarcity of forex and
marketers’ inability to offset their loans,
have made it difficult importing kerosene
and other petroleum products into the

Just a few weeks ago, NNPC announced the
release of additional volumes of 4.6 million
litres kerosine to consumers around the
country. Anibor Kragha, Chief Operating
Officer of the Refineries, had said the Port
Harcourt Refining Company Limited (PHRC),
Warri Refining and Petrochemical Company
(WRPC) and the Kaduna Refining and
Petrochemical Company (KRPC) were all back
on stream

“This impact is not being felt due to the high
demand for the product. The demand is
higher than the supply, so the price will be
affected,” Mike Osatuyi, the National
Operations Controller of Independent
Marketers Association of Nigeria (IPMAN)
told The Guardian in an interview.

To make kerosene available, Osatuyi stressed
the need for the Federal Government to
make it possible for marketers to access
foreign exchange, as well as make the
refineries work at full capacity.
A marketer said: “The product is not really
available, because whatever we are getting
from NNPC is not enough to go round.
Another problem is that some marketers
prefer to sell it as aviation fuel. There is
scarcity of aviation fuel and kerosene can
easily be supplemented for aviation fuel.

Since the price of aviation fuel is high,
kerosene easily comes as an alternative.”
The source accused NNPC of selling at
ridiculous prices at the depot, saying, “We
bought at NI44 per litre on Wednesday and
they increased it to NI88 on Thursday.”
In response, Ughamadu described NNPC as a
commercial entity, saying market forces now
determine the price of kerosine, as it remains
deregulated. Obafemi Olawore, Executive
Secretary, Major Oil Marketers Association of
Nigeria (MOMAN), said marketers are
shunning importation because of the
inaccessibility of forex, thereby leaving
importation only to NNPC.
He explained that there has been discussion
between the government and marketers,
regarding foreign exchange differentials,
delayed payments interest and bridging
claims, which were expected to boost and
sustain fuel supplies.
He said: “The government has stressed the
importance of continued private sector
participation in the entire downstream sector
value chain and as such, find lasting solution
to the outstanding debt.” 

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