Toba Owojaiye ReportingÂ
Fuel queues have reappeared as oil marketers suggest a price of N720 per litre and put a halt on fuel imports. Oil marketers have expressed concern that if the exchange rate remains within the range of N910 to N950 per dollar on the parallel market, the cost of petrol could surge to somewhere between N680 and N720 per litre in the near future.
They have also pointed out that due to a shortage of foreign exchange, dealers who intended to import petrol are facing obstacles and are unable to proceed with their plans. This warning comes after the local currency surpassed the N900 per dollar mark, with the naira being sold for over 945 per dollar on the parallel market last Friday.
Reports indicate that queues have resurfaced in certain parts of Lagos and Abuja as of Monday. Oil dealers have highlighted that the Central Bank of Nigeria’s Importers and Exporters official exchange window, which offers a more favorable exchange rate of around $740 per litre, is currently lacking liquidity.
Consequently, it’s unable to provide the $25 million to $30 million needed for petrol importation by dealers. This circumstance has led to the suspension of petrol imports by dealers who were initially eager to engage in such activities.
According to industry insiders, a marketer who recently imported petrol is now facing challenges in recovering their investment due to the devaluation of the naira.
High-ranking officials from major oil dealers have indicated that an increase in petrol prices is likely unless there’s an appreciation in the value of the local currency in the weeks to come.
Leaders of various oil industry associations in Nigeria, including the Major Oil Marketers Association, Independent Petroleum Marketers Association, and Petroleum Products Retail Outlets Owners Association, have emphasized the need for government intervention to address this crisis.
Chief Chinedu Ukadike, the national public relations officer of IPMAN, explained that petrol prices are now driven by forex fluctuations, hence a price hike should be anticipated.
He noted that the demand and supply of foreign exchange play a significant role, adding that other manufacturers reliant on dollars are also grappling with the same currency challenges.
Ukadike underscored that oil marketers are still obtaining dollars from the parallel market since the official window provided by the Central Bank of Nigeria lacks liquidity. He suggested that Nigerians should prepare for a price range of N680 to N720 per litre if the exchange rate remains around N910 to N950 per dollar.
Furthermore, he cautioned that the price could reach N750 per litre if the dollar rises to N1,000.