Sopuruchi Onwuka

Motorists and sundry consumers of the premium motor spirit in the country must brace for price jump ahead of possible full commercial deregulation of the product which rules the pace of inflation in the country.

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Domestic fuel market supplier, the Nigerian National Petroleum Company (NNPC) Limited, declared weekend that it is currently struggling with the role following intense financial strains.

The distress call follows reports that the national oil company which had ruled the market with state monopoly since 2015 is now unable to defray over $6 billion debts it owed suppliers of petrol.

The debt is blamed for the prevailing breaches in contracts to supply NNPC some five cargoes of products, a situation that has translated to acute fuel shortages in the country.

Group spokesman of the national oil company, Olufemi Soneye, stated in a media release that “NNPC Ltd faces financial strain due to PMS supply costs, impacting supply sustainability.”

He confirmed the company’s significant debt to petrol suppliers, adding that “this financial strain has placed considerable pressure on the Company and poses a threat to the sustainability of fuel supply.”

While acknowledging the company’s statutory role as the the supplier of last resort for the domestic fuel market in line with the Petroleum Industry Act (PIA), Soneye stated that the company was collaborating with relevant government agencies and other stakeholders to maintain a consistent supply of petroleum products nationwide.

“NNPC Ltd remains dedicated to its role as ensuring national energy security,” he said, eventhough the fuel market has since April been struggling with supply deficits and price jumps.

With the development, the fuel supply situation in the country is set to worsen while prices are about to hit the roof as a combination of scarcity and withdrawal of subsidized from the market are set to spark off bullish trends.

The Oracle Today reports that jump in the prices of petrol in Nigeria is a major  trigger for inflation which has already reached about 40 percent rise since the incumbent President Bola Tinubu assume administration of the federal government.

Lagos which is the country’s main fuel import entry point is currently experiencing its worst crisis with a liter of petrol officially selling above N900 for the first time.

The statement from Soneye is a sharp departure from the previous declarations that the company was in full control of the situation in the market with adequate stock holding that would last deep into the future.

The NNPC Limited had in July attributed the lingering petrol scarcity to a ‘hitch’ in the discharge operations of vessels delivering petrol to filling stations in these regions.

Soneye had said this in a statement that the ‘hitch’ disrupted normal operations, adding the company was working with other stakeholders to resolve the issues and restore normalcy.

The prevailing periodic fuel scarcity situation has dampened the expectations that subsidy removal would stabilize the fuel supply in Nigeria.