The Depot and Petroleum Products Marketers Association (DAPPMA) has urged the Federal Government to deregulate the downstream sector to ease importation and liberalise petrol prices.
The Executive Secretary of DAPPMA, Mr Olufemi Adewole, told the News Agency of Nigeria (NAN) on Wednesday in Lagos that if the downstream was fully deregulated, it would address distribution challenges in the country.
According to him, foreign exchange has been a major challenge to marketers in importation of petroleum products.
“If the sector is deregulated, some Nigerians who have dollars will bring it out to support importation of products.
“Most of the queues currently experienced are due to inability of marketers to import petrol and non-availability of FOREX,’’ he said.
Adewole said that competition among importers would reduce price of petrol even below government official price.
He said that deregulation would drive some importers out of the business while efficiency would enable others to compete favourably by dictating prices albeit reduced rates.
The DAPPMA scribe, who said that Nigeria petrol market could not have price stability, added that even in the U.S, fuel pump price changed regularly based on market forces.
“So, you may not expect price stability over too long a period but for price uniformity, Nigeria should just do away with that notion.
“But in reality there had always been price disparity. Price uniformity had only been on paper not in reality.
“Product insufficiency is the bane and for as long as human beings can be tempted to sell and make higher gains elsewhere, for so long will there exist a breach in the supply to area of price control,’’ Adewole said.
He, however, urged government to improve on its effort in ensuring local refineries worked optimally to ease local distribution of fuel within the country.
However, some marketers who preferred anonymity urged the Department of Petroleum Resources (DPR) to create a departmental office within the Apapa private depot to checkmate erring depot owners.
They said that some private depot owners took advantage of the current situation to increase ex-depot price from N77 to N98 per litre.
The marketers said that “no marketer would sell petrol below the cost price; once a product is bought above the ex-depot price, there is no way a marketer can sell at N 86.50k.
“The inability of marketers to access foreign exchange from banks is frustrating importation of petroleum products, especially, Premium Motor Spirit (PMS), or petrol, which is in very high demand in the county.
“The queues are still long because there is no foreign exchange to bring in cargoes.
“For now, there is inadequate FOREX. If we get the FOREX, we will be able to bring in the cargoes and supply all our customers.
“The much that we have in circulation right now is from our members and NNPC imports; all hands are on deck to ensure that the fuel queues disappear in a short time,’’ he said.