Depot Owners Defy FG Ceiling On PMS Price, Sell for N136 Ex-depot Price

Even though the Federal Government, through the Petroleum Products Pricing Regulatory Agency (PPPRA) had recently directed that Premium Motor Spirit (PMS) should be sold by depot owners between N123.28 and N133.28 per litre as the indicative ex-depot price, Shipping Position Daily findings have shown that some of the depots are now flouting this directive.
Some of the depots visited by our correspondent last week included:  MRS, Integrated Oil, Folawiyo Energy, Rahamaniyya and Eternal on the Apapa-Oshodi expressway axis, and Fatgbems, Bovas on the Kirikiri axis and Hensmor petroleum and Heyden on the Satelite Town axis of Lagos.
Investigations however revealed that some of them were flouting the PPPRA’s directive. For example, selling above the N123.128 to N133.128 ex-depot price were; BOVAS Depot for N134; Heyden Petroleum for N135/N136; MRS depot at Tin Can Island Port sells at N134, Hensmor- N134 and Eterna Oil sells for N134.
Depots that sold product within the range of the price band included: Fatgbems – N130/N132; Rahamaniyya – N133; Folawiyo -N133, Sahara Energy – N133 and Integrated Oil – N132/N133.
A source at Sahara Energy who pleaded anonymity told Shipping Position Daily last week however that the price of petrol has not been stabilized yet, adding that the price would still be increased before importers can make gains. He said this was because the Federal Government has failed to make foreign exchange available for the marketers.
“I cannot totally blame those marketers selling the product at that price, the government was not realistic about the price of the fuel, there is no way we would be able to source foreign exchange at N320 per dollar, which translates to a pump price of N165 per litre, and government would be expecting us to sell at N145”
“Of course, the N145 is not sustainable and if you go to some fuel stations now you see them selling for N150 per litre because they must cover up and make their gain” he said.
The PPPRA Acting Executive Secretary, Mrs. SE Iyoyo has however warned that it would continue to monitor the market fundamentals in line with the policy of appropriate pricing, with a view to advising the marketers on subsequent guiding price band for petroleum products at the beginning of every month.
The federal government had earlier increased the pump price to N145 to allow marketers source for foreign exchange at N285 per dollar, against the official N197 for which the previous pump price of N86 was based.
The major marketers, who received forex assistance from the international oil companies (IOCs), have revealed that they source dollars at N320, which translates to a pump price of N165 per litre, against the government's projected N145.
The independent marketers and other importers on the other hand, have however argued that their exchange rate at the parallel market is as high as N360 per dollar, thus making the N145 official pump price potentially unsustainable.