The Nigerian National Petroleum Company Limited (NNPCL) has reached an agreement to sell Premium Motor Spirit (PMS) otherwise known as petrol at the price of N995 per litre to members of the Independent Petroleum Marketers Association of Nigeria (IPMAN).
Following the intervention of the Department of State Service (DSS), Hammed Fashola, the National Vice president of IPMAN noted that it solved a lot of problems being faced by marketers in the industry.
He said, “We really appreciate their intervention. They are doing their job. Anywhere they have seen that there may be a crisis, it is their duty to intervene. And their intervention brokered peace and understanding between the parties, and everybody agreed to work together.
“For now, tentatively, I think they are offering us N995 per litre.” He added, regarding the price in which the NNPC will sell PMS to IPMAN.
He also said that the price of petrol might go higher than the N995 per litre which the NNPC is offering as a result of the cost of transportation from one location to another.
“Our members sell at N1,200 or so and this depends on the location. I think with the N995, there will be a little reduction. Don’t forget that if you transport a product from Lagos to a far distance, you will pay for transportation and other charges,” he said.
He explained that they are trying to standardise the price by analysing costs and expenses to find a common ground. Although an exact price cannot be provided at the moment, he emphasized that they are working on it, particularly in the Lagos area and other regions, by factoring in transportation costs. Eventually, they plan to set a uniform price for themselves, and marketers had previously struggled with price differences, but the new developments involving Dangote would bring a change.
“The price disparity has been a disadvantage between us and the NNPC Retail and major marketers. So, we are trying to look at how to close that gap so that we come back fully into the business. The lack of direct supply has been our problem, and now that we are solving that problem, I don’t think that disparity will be there again,” he stressed.
According to Fashola, the queues in filling stations are because of that difference in prices.
“There are no queues; it is the price disparity that is causing the queues. So, if there is not much difference, we have filling stations everywhere; just drive in, buy fuel, and go. But that so much difference in the price is creating that scenario of queues,” he added.
He responded to the directive that marketers can now buy petrol straight from local refineries, saying the association would meet with Dangote this week.
“For now, we intend to meet with Dangote this week to see how we work out the modalities and all that. The Federal Government has given a directive and we want to take full advantage of that.
“At the same time too, we are not ignoring NNPC. So, whichever way, we are ready to do business with NNPC. It depends on the price, we go for the best”, he stated.
IPMAN disclosed on Thursday that the cost of fuel from the Dangote Petroleum Refinery to NNPC was approximately N898/litre, but that NNPC was selling the same product to independent marketers in Lagos for N1,010/litre. The association, which owns more than 70% of filling stations in the country, protested and threatened to shut down operations, as well as a return from the NNPC for payments made by its members for previous petrol supply.