The Independent Petroleum Marketers Association of Nigeria (IPMAN) has said that the cost of buying 45,000 litres of a truck of fuel has risen from N9.6 million to between N34 million and N36 million at the depots of private owners.
The Chairman, IPMAN, NNPC Depot, Ore Western Zone of Nigeria, Engineer Shina Amoo, in an interview with New Telegraph on Wednesday also said the cost has risen to N26 million at depots of the Nigerian National Petroleum Company Limited (NNPC Ltd).
He attributed the price increase to fuel subsidy removal, deregulation and foreign exchange volatility.
He also decried that banks now charge them between 36% and 37% interest annually.
He stated that these challenges, which have skyrocketed their costs, have made the business environment toxic.
According to him, it is even worse that they no longer access petroleum products directly from the NNPC depots and so have now been forced to buy at exorbitant rates from depot owners.
He stated that because of the high cost they incur to access the product, they sell between N800 and N850 in some states while NNPC stations sell between N568 and N580.
He added that this has made it difficult for independent marketers to compete favourably with stations of NNPC Retail.
Amoo said: “Before now, a truck of fuel, 45,000 litres, was about N9.6m but now it is from N34 to N36m. Banks are charging us 36% and 37% interest rate per annum. That is killing.
“The high cost of fuel was caused by subsidy removal, deregulation and the foreign exchange issue due to the importation of the product. If importation is reduced, we could enjoy a cheaper landing cost of petrol.
“NNPC is about N26 million for a truck of 45,000 litres of fuel. But before you can get such a product from NNPC, it will be difficult. I am an independent marketer, I accessed NNPC products with my official product over three or four years. I buy from private depot owners at a premium to my independent retail outlets.
“That is why I decided to give out my outlets to major marketers and semi-middle marketers to do business with them. I carry their brands. I buy the product, and I have my N5 margin but the turnover is what I am sitting down with.
“The turnover, which is my frequency of loading, my pump integrity, my commitment to the total quality management of the station, I enjoy customer loyalty. I will still be able to exist in business despite the 36% or 37% of bank rate.”
He attributed the scarcity of fuel in some areas to inadequate supplies. He also alleged that the NNPC Ltd was giving preferential treatment to NNPC Retail in the allocation of petroleum products to the detriment of independent markets.
He called on the appropriate authorities to address the challenges and give the marketers a relief.
Amoo said: “There is no adequate loading. Even NNPC itself, that is the importer of the product, if they have 20 stations in your city, you will discover that it is only a few of them that will be selling.
“Now why will they remember independent marketers that are under them? The NNPC established NNPC retail which is competing with the independent marketers. NNPC Retail and IPMAN are babies of NNPC but NNPC gives priority to NNPC Retail and NNPC Retail is not having enough volume to sell. If they could be selling, it would be a minority of their stations. So tell me how they can remember us?
“Even if there is enough product in the country to buy, we are buying from NNPC which has NNPC Retail and their stations are numerous.
“They are competing with us, they are beside and opposite us, selling between N568 and N580, while we buy the product at premium.
“Not getting the product from NNPC we buy from a third party and we will be selling about N800 and N850. People will be calling us thieves while they call NNPC station owners, pastors.”
