Welcome, Guest: Register On Nairaland / LOGIN! / Trending / Recent / New
Stats: 3,143,380 members, 7,781,065 topics. Date: Friday, 29 March 2024 at 08:19 AM

Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. - Politics - Nairaland

Nairaland Forum / Nairaland / General / Politics / Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. (26749 Views)

Breaking! President Buhari Arrives Nigeria - Sahara Reporters (pictures) / Fuel Scarcity Will Persist Till May–kachikwu / Abdullah Dikko, Ex-Comptroller-General of Customs Flees Nigeria- Sahara Reporter (2) (3) (4)

(1) (2) (3) (4) (Reply) (Go Down)

Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by zinachidi(m): 9:42am On Dec 20, 2015
Nigerians are unlikely to see any respite from fuel scarcity, despite the National Assembly’s approval more than N590 billion for fuel subsidy payments and the release last week of the initial N408 billion by the Ministry of Finance and Debt Management Office.

The Debt Management Office issued sovereign debt notes to fuel marketers, and the Central Bank of Nigeria redeemed the notes, with all marketers’ accounts credited.

Even so, most marketers are reportedly unable to increase fuel imports or even import at all due to non-availability of US dollars to pay for such purchases.

Part of the problem is the convoluted process for fuel imports. First, thePetroleum Products Pricing Regulatory Agency (PPPRA) issues allocation letters to various marketers to import fuel.

Thereafter, marketers apply to the Directorate of Petroleum Resources to issue import permits based on the pricing agency’s approval. This step often takes as much as two weeks. Fuel marketers then contact foreign oil traders and refineries for fuel supplies. Once suppliers and the marketers agree on prices, the supplier issues pro forma invoices.

The marketers open Form “M” which they submit to their various local banks. The local banks then seek the CBN’s approval to open letters of credit, a process that takes about seven days. Once the approval is obtained, the local bank opens a letter of credit and seeks a foreign bank to add confirmation to the letter of credit. The foreign/confirming bank in effect grants a loan to the Nigerian bank. Usually, the expectation is that the loan would be repaid within a period of 60 to 90 days after shipment and presentation of documents showing shipment and delivery.

SaharaReporters learnt that many fuel marketers had opened letters of credit and even provided naira to local banks, but many of the local banks have been unable to access dollars from the CBN to enable them to clear past due obligations under letters of credit already granted.

Owing to a series of defaults, many foreign banks have been reluctant to handle Nigerian banks’ letters of credit.

An executive at one of Nigeria’s major commercial banks disclosed that some of the bank’s letters of credit issued in March have yet to be paid till date. He added that, with rapidly falling oil prices, Nigerian banks would not have sufficient dollars to meet past and present obligations.

Nigeria’s external reserves currently stand around $30 billion, with total forex requirement by the fuel marketers around $1billion.

To worsen matters, fuel marketers have been compelled to pay the Nigerian Maritime Administration and Safety Agency (NIMASA) and Nigerian Ports Authority (NPA) in dollars, even though the Federal Government has barred the spending of dollars within Nigeria.

CBN officials disclosed say the bank was not offering dollars indiscriminately because some fuel marketers were reselling dollars obtained at official rates in the parallel market at huge profits. The CBN sells dollars to banks at N199. One fuel importer alleged that, instead of offering the foreign currency to them, banks were selling dollars in the black market for N270-280.

http://saharareporters.com/2015/12/20/why-fuel-scarcity-will-not-go-away-soon-nigeria
Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by kidgod: 9:45am On Dec 20, 2015
Prophets of Doom


[size=24pt]Kidgod
[/size]

1 Like 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Nobody: 9:48am On Dec 20, 2015
I wish i dnt believe this but it seem to be the bitter truth.

8 Likes 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Nobody: 9:49am On Dec 20, 2015
National kake
Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Nobody: 9:50am On Dec 20, 2015
jst in case

1 Like

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Arnoldo(m): 10:08am On Dec 20, 2015
HMMM
Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Plus10(m): 10:09am On Dec 20, 2015
It seems this present administration lacks ideas on how to manage the economy I would advice for now they should borrow ideas from the previous government in order to atleast relief us from this current suffering.

61 Likes 3 Shares

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Nobody: 10:11am On Dec 20, 2015
Buhari has a mission to take us back to 1984. We are in for an economic tsunami

32 Likes 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Nobody: 10:16am On Dec 20, 2015
We simply say Economy without understanding the complexity of this system called Economy. Nigeria is gradually going into a bad economic situation where it will take years to appreciate any growth. It's like the type of mud that when you fall into it, the more you struggle to get out of the mud the more you sink into it. For instance, as we take measures to appreciate Naira against Dollar the more we cause loss of job, BDCs are closing, Treasury bill interest is down, soon we'll start getting retrenchment from banks, now Oil importers are fihding it difficult to import, PMS remains high, cost of production and cost of transportation remains high, goods and products gradually add price.

34 Likes 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by okosodo: 10:24am On Dec 20, 2015
and real complicated problems have not started to come yet

3 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Plus10(m): 10:28am On Dec 20, 2015
It is crystal clear now that this present government is birate of ideas.That is why we keep saying that as a leader you have to be an all rounder which Buhari as a leader does not posses .As it seems buhari only idea is how to fight corruption and jail whoever that may seem as threat to his government.

33 Likes 2 Shares

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by DaBullIT(m): 10:42am On Dec 20, 2015
No matter what people say , I still believe in Buhari and i hope he works it out

24 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by trillville(m): 10:49am On Dec 20, 2015
Chai, if only Jonathan had built refineries with the sure-p funds rather than Choping the funds, we may not be in this position today.

Even worse is the fact that yaradua had already put plans in place for building three new refineries before his demise.

God put us in this situation and he will deliver us from it.

39 Likes 3 Shares

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by omenka(m): 11:08am On Dec 20, 2015
Now, the major snag is in accessing dollars for the transactions which is quite unfortunate.

This is the more reason Baba should intensify his campaign to bring all those who had all five fingers in our pot of soup to book!!

The harm PDP did our economy wasn't just in stealing- they damn near stole every single penny of foreign currency we had in our bank. Dasuki distributed his yams in dollars, Stella Uduah stole her yams in dollars, ditto Alison et al.

Baba must not accept remittances in Naira should they decide to voluntarily forfeit some yams- they must be in very hard currencies!!

Like DaBullIT said, I believe Baba will fix this. It is a given!

18 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by seunmsg(m): 11:53am On Dec 20, 2015
The only solution to this problem is for Nigeria to have functional refinery. The PMB government should immediately start the process of building new refineries to meet the fuel needs of the country. The money saved from the complete removal of subsidy can be pumped into the project with private sector partnership. Under a year and half, it will be completed if the government is serious.

5 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Pontaboki: 11:55am On Dec 20, 2015
Illiterate Buhari has no solution to our problem.The Zoo is dead already!!!

11 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Opinedecandid(m): 12:10pm On Dec 20, 2015
Policy sumasault, directionlessness, cluelessness, daftness, dulladihnoness of this administration is the reason for this mishap.

13 Likes 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by AdeniyiA(m): 1:12pm On Dec 20, 2015
we should make our refineries work, construct new ones and produce for us!! !!! Are we cursed? angry

2 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by brunofarad(m): 1:16pm On Dec 20, 2015
Such a pity

BRACE UP NIGERIA

Hard. Times ahead




















We are building a world class company.
Watch out for us in the NEWS sometime in the future.






¤••• FARAD CONTRACTORS NIGERIA •••¤

1 Like

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Sunnycliff(m): 1:16pm On Dec 20, 2015
Buharinomics at work! Enjoy the change while it lasts!

11 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Sijo01(f): 1:16pm On Dec 20, 2015
This is what you get for having a clueless dullard as president/petroleum minister.


GEJ and Deziani were not saint but Nigeria has never experienced this long duration of fuel scarcity.

16 Likes 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by ichommy(m): 1:16pm On Dec 20, 2015
Pontaboki:
Illiterate Buhari has no solution to our problem.The Zoo is dead already!!!

4 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Diesel1(m): 1:16pm On Dec 20, 2015
kestolove95:
Let us divide dix country...fuel will b available
I like u

2 Likes 1 Share

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Novaworld(m): 1:17pm On Dec 20, 2015
Ok
Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by looseweight: 1:17pm On Dec 20, 2015
Its well
Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by tammie24: 1:18pm On Dec 20, 2015
Na them sabi o jare
those who voted you into power will soon confess

11 Likes

Re: Why Fuel Scarcity Will Not Go Away Soon In Nigeria- Sahara Reporters. by Mattada: 1:18pm On Dec 20, 2015
Kk

(1) (2) (3) (4) (Reply)

PDP Set To Take Over Adamawa State - NewTelegraphng / Border Closure: More Rice Mills Spring Up Nationwide / SERAP To Buhari: Copy ‘Namibia Example’, Ban Car Perks For Presidency, Ministers

(Go Up)

Sections: politics (1) business autos (1) jobs (1) career education (1) romance computers phones travel sports fashion health
religion celebs tv-movies music-radio literature webmasters programming techmarket

Links: (1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

Nairaland - Copyright © 2005 - 2024 Oluwaseun Osewa. All rights reserved. See How To Advertise. 24
Disclaimer: Every Nairaland member is solely responsible for anything that he/she posts or uploads on Nairaland.