Marketers Caution FG on Hasty Fuel Import Ban
Marketers have argued that Nigeria cannot ban fuel importation now, saying the country’s refining capacity is still low.
The marketers under the aegis of the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Petroleum Products Retail Outlet Owners Association of Nigeria (PETROAN) said any ban on fuel importation now could trigger scarcity and a hike in fuel prices.
Economic Confidential reports that under President Bola Tinubu’s ’Nigeria First Policy’, the President directed on Monday that “no procurement of foreign goods or services already available locally shall proceed without justification and a written waiver from the Bureau of Public Procurement.”
Amid claims that the country’s refining capacity had increased and the comments by the founder of the Dangote Petroleum Refinery, Aliko Dangote, that the facility can meet local fuel needs, there are speculations that the ban might be extended to petroleum products.
However, speaking with our correspondent, the National Vice President of IPMAN, Hammed Fashola, maintained that the Federal Government should not think of banning fuel imports this time.
“I don’t think the government should be thinking in the direction of banning the importation of petroleum products. If they are thinking in that direction, we would like to advise them that this is not the right time to do that because some of the refineries are still under construction. It’s the only Dangote refinery that we can boast of for now in Nigeria.
“The important thing is that the government has to be sure of fuel security in the country. Before we can ban fuel imports, we must make sure that we have more refineries around that can take care of our daily consumption. With what is on the ground, I don’t think the government would like to do that,” Fashola stated.
According to him, some other products are essential to people’s lives that they have to spare in the importation ban policy, especially if local production is low.
He maintained that the fuel security being enjoyed now should be sustained by the government.
“We need to sustain what we are enjoying now in the oil and gas sector. Affordability and affordability is very key,” he noted.
Reminded that the Dangote refinery has boasted that it can satisfy local needs, while the Nigerian National Petroleum Company Limited and other modular refineries are also producing, Fashola said the capacity of these refineries must be put to the test first.
“We must put all these to the test, and not just speculate. In my own candid opinion, I think that by the time we have like two or three refineries with reasonable capacity, we can be sure of banning fuel imports. Don’t forget that Dangote has its own commitment outside this country. It has its customers; it has a commitment that it has to meet.
“So, all those things have to be considered before we say we are good to go, locally. I don’t know much about the refining capacity of NNPC refineries for now, but all we know is that they are working and they are pushing to the market. But with what is on the ground, we have to be sure that we have enough locally before we make a move to ban the importation of petroleum products totally,” he explained.
Asked to state what could be the consequence should the government ban fuel imports now, Fashola replied, “I foresee price increase, and if care is not taken, maybe scarcity. We should not rule out the intervention of these imported petroleum products, too. Surely, there will be market reactions if you stop imports suddenly because the imported fuels are taking care of a certain quantity of our demands and our daily needs. So, it should not be suddenly done.”
Similarly, the Petroleum Products Retail Outlet Owners Association of Nigeria also warned the Federal Government against banning fuel importation into Nigeria.
PETROAN said banning fuel importation could lead to shortages or profiteering, saying the nation’s refining capacity is still low.
PETROAN’s National President, Billy Gillis-Harry, said the association cautiously welcomed Tinubu’s decision to ban the importation of foreign goods produced locally, but it emphasised the need for careful implementation to avoid unintended consequences.
The association urged the government to ensure that the policy does not lead to shortages or price increases, “particularly in the petroleum sector, where local refining capacity is still being developed.”
PETROAN expressed concerns that the policy could worsen Nigerian inflation, emphasising the need for energy security.
“Our primary concern is the availability and affordability of petroleum products in Nigeria to meet the daily consumption volume of over 46 million litres of petrol and other petroleum products. We must ensure that our policies do not compromise energy security, as this could have far-reaching consequences for the economy and the well-being of Nigerians,” Gillis-Harry said.
The association called for increased investment in local refining infrastructure and support for domestic industries to enhance their competitiveness.
The President of PETROAN applauded President Bola Tinubu for the bold step, warning, however, of potential pitfalls.
Gillis-Harry advised the government on the import policy, as he cautioned against economic shock.
While commending the government’s efforts to strengthen the domestic economy and promote local content, the PETROAN boss emphasised the need for careful consideration to avoid unintended consequences.
He advised that essential and sensitive products, such as petroleum products, pharmaceuticals, and other highly consumable goods, should be exempted from the ban or have a waiver to ensure their continuous availability.
“This is because some products may not be readily available locally, or their local production may be insufficient to meet demand, leading to shortages and price hikes. Other factors that may necessitate importing goods include unavailability of specialised technology or expertise locally, higher quality standards of imported goods, economies of scale favouring imports, strategic or critical nature of the product,” he highlighted.
Citing examples from other countries, the PETROAN boss noted that even the United States, under the ‘America First’ policy, has implemented targeted tariffs rather than blanket bans, allowing for flexibility and exemptions for critical goods.
He listed the advantages of banning the importation of fuel and other foreign goods, saying the promotion of local content can stimulate economic growth, create jobs, and increase domestic production while reducing reliance on foreign goods to narrow the trade deficit and conserve foreign exchange.
On the contrary, he emphasised that banning imports could lead to shortages of essential goods, particularly if local production is insufficient or unreliable.
He added that limiting importation can result in higher prices for consumers, as local producers may not be able to meet demand efficiently, leading to inflationary pressures.
“By applying wisdom and caution, PETROAN believes that the government can achieve its objectives while minimising potential disruptions to the economy,” he said.
It could be recalled that the founder of the Dangote oil refinery and other local refiners had earlier called on the Federal Government to stop issuing licences to marketers for the importation of fuel.
The Dangote refinery also dragged the Nigerian Midstream and Downstream Petroleum Regulatory Authority to court for granting licences to marketers despite having the capacity to meet local fuel demand.
Dangote said it was illegal to import fuel into Nigeria with the current refining capacity.
During the Federal Executive Council meeting held on Monday, President Bola Tinubu announced that the Federal Government will bar all Ministries, Departments, and Agencies from procuring foreign goods and services where local alternatives exist.
This move, it was learnt, is part of a broader effort to strengthen local industries and reduce import dependency.
The directive was shared in a statement issued by the Special Adviser on Media and Public Communication to Tinubu, Sunday Dare, through his official X account.
The new policy, tagged the ‘Nigeria First Policy’, is designed to stimulate domestic production, enforce local content compliance, and overhaul the government’s procurement practices.
“We must foster a new business culture — bold, confident, and Nigerian. The government must lead by example. We will invest in our people and our industries by changing how we spend, procure, and build.
“Going forward, Nigerian industry will take precedence in all procurement. Where local supply falls short, contracts will be structured to build capacity here. Contractors will no longer serve as intermediaries sourcing foreign goods while local factories lie idle.
“We will make what we use and use what we make — not as a slogan, but as a national commitment,” Tinubu was quoted.
The President directed that “no procurement of foreign goods or services already available locally shall proceed without justification and a written waiver from the Bureau of Public Procurement.”
This directive could reduce fuel importation and make marketers source petroleum products from local refineries.
