Why Kerosene is still not available despite deregulation

Photo of a queue for kerosene

Since the Federal Government has finally stopped payment of subsidy on kerosene the product is still not readily available in filling stations, especially those of  independent and major oil marketers, who allege that the Nigerian National Petroleum Corporation lacks the capacity to meet their demand for the commodity.

Senior officials of the Petroleum Products Pricing Regulatory Agency has said that the government decided to stop subsidising House Hold Kerosene (HHK) as well as Premium Motor Spirit, popularly called petrol, in order to allow the marketers to import the white products and sell at approved prices as captured in the PPPRA pricing templates.

Punch on Tuesday in Abuja found out that virtually all filling stations expect the ones owned by the NNPC were not selling kerosene, although they were dispensing petrol.

While the marketers blamed the seeming scarcity of the product on the fact that they had yet to get approval from the government to start importing the commodity, officials at the headquarters of the NNPC and the PPPRA stated that the deregulation of the kerosene market was enough evidence to let the marketers know that they were free to delve into the trade.

Speaking on why the product was still not readily available at filling stations, a major oil marketer said prior to the removal of subsidy, only the NNPC had approval to import the product, but was quick to state that the corporation hardly met the demand by depots not to talk of meeting the demands of consumers across the country.

The marketer, who spoke on condition of anonymity as he was not authorised to speak officially on the matter, said, “The way they (NNPC) bring it is that at any point in time they cannot have supply for all the depots that need the product.

“So, when they bring in a vessel, it takes care of about three to four depots, and when another vessel comes in about three weeks after the first, it takes care of another set of three or four depots. Therefore, you can only have the product in about eight depots at a period.

“For example, as big as our depot is, for about three months, we’ve not got any supply of kerosene. And it is important to let you know that it is only the NNPC that brings in kerosene. Marketers don’t bring in the product. They don’t give us permit to bring in kerosene except petrol. Unless they have plans to start it today or tomorrow.”

Group General Manager, Group Public Affairs Division, NNPC, Mr. Ohi Alegbe, told Punch correspondent that the corporation’s subsidiary, Pipelines and Product Marketing Company, was responsible for the supply of HHK to the depots.

According to him, the PPMC is a business outfit and will only supply to depots that can meet stipulated requirements, adding that the marketing company was a profit-driven firm.

However, Alegbe explained other reasons  the marketers might have not got the product from the corporation through the PPMC. He stated that kerosene had been deregulated and issues surrounding its importation by independent oil marketers were being handled by the PPPRAAbout two weeks ago, the Federal Government stopped subsidy on the product. Instead of the regulated pump price of N50 per litre, the PPPRA.

The Federal Government stopped subsidy on the product about two weeks ago and instead of the regulated pump price of N50 per litre, the PPPRA stated that the product would sell for N83 at NNPC outlets.