NNPC Becomes Sole Petroleum Importer,Others Battle Forex Shortages
The Nigerian National Petroleum Corporation (NNPC), a state-owned oil company, has become the exclusive importer of petrol, while other competitors face challenges due to a shortage of foreign currency.
According to Mele Kari, the Chief Executive of NNPC who states that the corporation is once again the sole importer of petrol due to licensed local private firms facing difficulties in acquiring foreign currency. This development comes after four months of allowing private players to participate in petrol imports.
Nigeria, the biggest oil exporter in Africa, relies heavily on fuel imports to satisfy the needs of its about 200 million inhabitants since it lacks sufficient refining capacity. Consequently, the country has resorted to trading crude oil for fuel, resulting in a loss of valuable U.S. currency.
On June 3, 2023, Mele Kari stated in an interview that Nigerian private companies will have the opportunity to import fuel, as the Nigerian National Petroleum Company Limited (NNPCL) shifts its fuel import system from crude oil swap contracts to cash payments.
In July 2023, certain fuel companies initiated imports. However, according to Mele Kyari, at an energy conference, these companies are currently facing difficulties in obtaining foreign currencies for the importation of petrol, also known as premium motor spirit (PMS).
"We are the only company importing PMS into the country. None of them can do it today. For them, access to foreign exchange is difficult. We create Foreign exchange (FX), therefore we have access to FX and their access to FX is limited." he stated.
Petrol holds immense significance to Nigerians as the primary source of energy for transportation and power generation, it fuels the nation's economy. Its availability and affordability directly impact the livelihoods and well-being of millions, making it a crucial aspect of daily life.
