3rd March, 2015
The Petroleum Products Pricing Regulatory Agency (PPPRA) on Tuesday blamed the current scarcity of petrol in the country on the devaluation of the naira.
It said this had led to delay in payment to oil marketers involved in the importation of petroleum products.
Executive Secretary of the agency, Farouk Ahmed, made this known in Abuja while fielding questions from the Senate Committee on Petroleum Downstream during the agency’s defence of its 2015 budget.
Ahmed, however, assured that the scarcity would abate at the weekend.
According to him, the scarcity of petrol is being experience across the country because of delay in payment to marketers.
He said that the devaluation of the Naira was responsible for inability of the marketers to access fund from their bankers. “The recent event was actually as a result of issues we had with the commercial banks where they were unable to open credits for our marketers, especially PMS marketers.
“The delay made it difficult for the cargoes that were earlier programmed to arrive at the scheduled time.
“This delay was further complicated by the devaluation in the Naira.
“There were two devaluations, one was when the Naira exchanged at one dollar to N168, and similarly the Central Bank further devalued the Naira to N199 to a dollar.
“This caused a lot of confusion in the sector where the marketers and their bankers were not sure of the actual delivery cost,” he said.
“We at PPPRA reviewed our template to reflect the new exchange rate as advised by Central Bank.
“After that was done, there was a bit of calm, however, those delays that were experienced in the first devaluation in November is what is manifesting now,” he Ahmed added.
He, however, said that the Ministry of Finance, the PPPRA and the Debt Management Office (DMO) had been working closely to ensure that the outstanding cargoes were cleared.
He disclosed that the DMO had approved the payment of some of the outstanding amount to the marketers. “Within this week or by the weekend, things will normalize; there is no cause for alarm,” he said.
Reacting to allegations that some oil marketers in the rural areas were selling petrol higher than N87 per litre, Ahmed said that the Department of
Petroleum Resources (DPR) was working hard to apprehend such offenders.
He said that the DPR has continued to revoke licenses of defaulters or have their stations sealed to serve as a deterrent.
Meanwhile, the committee considered and cleared the budget appropriation for the PPPRA and the Ecological Fund Office.
The two agencies were the only ones present out of no fewer than seven scheduled to appear before the committee on Tuesday.