Owners of petroleum products depots in Nigeria, who also import and market products under the aegis of Depot and Petroleum Products Marketers Association (DAPPMA) has urged the Federal government to urgently deregulate downstream sector so as to save the nation from fuel scarcity.
Executive Secretary of DAPPMA, Mr. Olufemi Adewole said in a statement that the government should deregulate the downstream sector and also ensure that the refineries are working at full capacity, “then only can we say goodbye to recurring fuel scarcity in the country.”
The statement read “Another area of contention is the instability of the exchange rate. Central Bank of Nigeria, CBN’s devaluation of the naira from N156/$1USD to (initially above N200/$1USD and later stabilized at) N190/1$USD placed additional financial burden on fuel importers.
“To the ordinary citizen, the drop in the international price of crude oil should translate to a drop in the local price of fuel however the CBN’ devaluation of the naira at the same time had a direct opposite effect on imported fuel as it only made the medium of purchase which is the $US dollar more costly to obtain. Import processes which began on the basis of the former exchange rate can only be concluded on the basis of the new foreign exchange rate adding N44/1$USD for such transactions.
“All these, the main subsidy, the interest on delayed reimbursement and the foreign exchange differentials owed to DAPPMA and MOMAN members as at today is in excess N200bn and the interest component will continue to rise until importers are paid to facilitate a refund to the commercial banks
“While the public has been informed that marketers were paid about N342.5bn in November 2014 and N37bn in March 2015, we would like to know why, despite a provision of more than N900 billion for subsidy in 2014, marketers are still being owed for deliveries made in 2014 thereby incurring avoidable interest and foreign exchange differential due to the 2015 devaluation of the naira.”
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