Petrol: FX Scarcity Stalls Fresh Importation
The hope of fresh petrol importation into the country may have been dashed, as findings revealed that oil marketers, who have been licensed to import fuel, are currently having difficulties accessing forex (FX).
Sources close to the matter said that three of the lincensed downstream firms had yet to source foreign exchange to purchase products.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) recently issued importation licences to six downstream companies.
However, only three of them- Eternal Plc, Emadeb Energy Services Limited, and Asharami Energy would begin importation this month.
However, sources confirmed that the companies, although have licences, would not be able to import fuels due to high exchange rates and forex scarcity.
“That is not true. Today, it pays you more to buy than to import because of the FX. It was about N775/$ as at last check,” one of the sources told The PUNCH when asked if they had started importing petrol.
“There is a need for clarity. We need to know: Are we importing or are we still lining up behind the NNPCL that is importing? But what NMDPRA wants is for us to import. But the big elephant in the room needs to be dealt with, which is FX. Even though they are trying to unify it, if you want to bring in 15KT (kilotonnes), you need about $12m. I have been trying to buy just about $3m-$4m for the base oil that we are bringing, and it was taking us forever. Not to talk of importing PMS. What we do currently is to get a PFI (Pro Forma Invoice) from PPMC and pay them. So, until FX is available, we cannot import,” another source in the know said.
On June 15, the NMDPRA announced that the three oil marketers would start importing petroleum products this month.
The Chief Executive Officer of NMDPRA, Farouk Ahmed, said the oil marketers reached an agreement to enhance cooperation with security agencies, with the aim of facilitating the seamless supply and distribution of petroleum products.
“Already, three oil marketers will from July this year start importing petroleum products into the country,” Ahmed said.
Ahmed later said the number of the firms had increased to six.
“There are six companies who said they want to import fuel in July. Of course, all the others may import in December, November or anytime, but those who expressed interest to bring in fuel in July there were six as of this morning,” the NMDPRA CEO said.
Emadeb, Eterna and Asharami did not respond to enquiries over the development.
Our correspondent also gathered that the drop in petrol consumption in the country has made foreign oil refineries such as Glencore, Vitol, Moko and others start offering products on credit to Nigerian marketers, due to low patronage.
“Low patronage has forced the likes of Glencore, Vitol and Moko for the first time to start chasing us and offering to sell on credit because they know the game is changing. A lot is changing. When the price was around $2.7m they did not offer us credit. Why now that price has shut up to $9.3m?” he quizzed.
The source added that no importer wants to take the risk of running at a loss due to the high exchange rate.
