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Exposed: 18 Major Reason For Fuel Distribution Shortfall ( Scarcity) - Nairaland / General - Nairaland

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Exposed: 18 Major Reason For Fuel Distribution Shortfall ( Scarcity) by byna: 10:09pm On Dec 25, 2017
Ladies and gentlemen , boys and girls ....
It's sad we had to celebrate this year's Christmas with so much pain from searching for petrol to fuel or cars and make trips to visit loved ones.

Well, below are the major reasons behind shortfall of PMS currently faced by the nation.

1. As the price of crude increased from around $46 per barrel to around $58 , there is a simultaneous increase in the refined products sold offshore

2. Prices of PMS went up offshore and the landing cost was above the selling pump price of #145 per liter

3. Independent marketers raised alarm for a need to increase pump price to around #160 - #170 per liter but the FG shunned them.

4. Since FG was not willing to pay subsidy to any marketer, they independent marketers abandoned the imports for only NNPC to handle both import and distribution.

5. NNPC was now selling to depot owners at #133 per liter for onward retail to customers to sale at #145 at gas stations.

6. NNPC became the sole distributor of PMS meanwhile selling at a loss of around #26 for every one liter imported . Which translated to close to $800bn loss every day for around 30m liters been consumed everyday in Nigeria.

7. At this rate , profits from our crude swap and sales would be highly reduced if continued.

8. Meanwhile across our borders, petrol seems to be sold at a rate higher than #145 per liter which led to product diversion across the borders to neighboring countries by product marketers who bought from the estimated 30m liters projected to be used in Nigeria everyday.

9. This cross border diversion increased our daily consumption from 30m liters to about 60m liters including our increased demand during the festive period and panic buys. Further increasing our revenue loss to around N1.2bn daily .

10. Due to poor planning , there was a delay in the supply chain between the last week of November and First week of December 2017 and this lead to shortfall in product availability in various depots across the nation from Lagos to delta to PH to calabar.

11. But due to our reserved in various filling stations across the country , it took additional 15days for the shortfall to begin to be felt by citizenry.

12. Our nation's refineries have been trucking out more of Diesel and Kero over the same period. As the capacity to refine has been reduced due to outdated equipmenta.

13. When demand is high, price goes up unhindered as this was the case of what we witnessed.

14. As the opportunity came up, jobless fellows decided to invest in the scarcity. You see people without any need for petrol ( not owing a car, generating set etc)queuing up in stations to purchase the already scarce commodity just to resale, again mounting more pressure on the system.

15. Reality: for every one liter fuel you purchase at #145 , government is selling at a loss already.

16. The only difference between now and subsidy Era is that , Government is not paying this revenue loss as subsidy to any marketer but absorbing it personally.

17. Prices would drop within the next 21days and return to normal as priority is given to mainly Abuja and Lagos.

18. It could take longer to reduce in other remote states across the country.
Re: Exposed: 18 Major Reason For Fuel Distribution Shortfall ( Scarcity) by Cameleon72(f): 11:00pm On Dec 25, 2017
Source
Re: Exposed: 18 Major Reason For Fuel Distribution Shortfall ( Scarcity) by marooh: 11:29pm On Dec 25, 2017
Media must come up with free thinker write up to make heavy traffic.... lipsrsealed

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