As price of premium motor spirit, PMS, soars, chairman of the Ibadan Depot of the Independent Petroleum Marketers Association of Nigeria, IPMAN, Alhaji Bukola Mutiu, has asked government at all levels to come to the association’s aid to cushion the effect of fuel subsidy removal.
President Bola Tinubu had on May 29, 2023, during his inaugural speech announced the removal of fuel subsidy, which led to the hike of PMS close to 300 per cent.
In an exclusive chat with OYOINSIGHT.COM, Mutiu said that IPMAN is in support of the deregulation of the oil sector as it believes it is the only way to make Nigeria better.
But according to him, “the new price of PMS has sent away some of his colleagues from business because majority of them could not fund a 45,000-litre truck of PMS,” explaining that “Before the removal of the subsidy, we were lifting PMS at N172 per litre and which translates to N7,740,161.25 for 45,000-litre truck. Some of us had paid for some past months until they wrote immediately the president announced the removal of subsidy. We were now forced to cough out an additional sum of N13,702,661 to balance up for the already payment of N7,740,161.25 which now makes a litre N476.50 from what it used to be before (N172) totaling N21,442,500 to lift a 45,000-litre truck of PMS.
“What that means is that some of our members who could not afford to raise three tickets before deregulation have been automatically forced out of business.
This is applicable to petrol alone.
Unfortunately, the hike in price is not proportional to our profit margin. Our profit margin have been affected so badly.
To keep members in business calls for seeking additional working capital through the bank who are borrowing at double digits rate. How do you want us to survive?
How could such a loan be repaid with other associated charges?
He appealed to the masses not to see IPMAN members as enemies of progress adding that “The masses were complaining that we used to effect change in price immediately there’s an increase. The change was as result of what the NNPC did immediately subsidy was removed. To lift the products already paid for requires for the payment of additional fee to the old rates. Currently, IPMAN is challenging NNPC to allow us lift the subsidized products already paid for but rather they were holding to a clause on the agreement we had with them— “that supply is subject to
availability of products”.
“So, we have no option but to look for additional funds in order to lift the products already tied down which payments had been made for past months in order to sell to the masses. Now with this latest development of allowing free importation, government should take cognizance of the number of outlets owned by IPMAN members across the country. IPMAN has over 85 to 90 percent filling stations across the country which means that we are at the helms of controlling what happens at the retail end.
“So if they are giving out up to between 6 to 7 importation licences, we should be given the privilege of having more above others because those they are issuing the licences to are third parties— who we will be forced go and buy from. This was what caused the last scarcity of product. That’s our first side of point we are pointing to the government.”
He disclosed further that it doesn’t take months to get license if government is willing to give its members. “It’s just a process within one or two weeks. IPMAN has been duly registered as an association.
If we are given the needed support by
the government in terms of offering a palliative of how we can access funds for the kind of product, the government places/organizes us on regional basis to enable the masses enjoy lesser price. That’s on the supply end.”
He added that when many investors are allowed to import the products, “It will allow for competitive market in the system.
They should allow many people have licence so as to give more people opportunity of importation. This will definitely affect market price if government allows multiple people to import. This will enable the masses go for the cheapest product.
“While we credit the new administration for announcing the removal of fuel subsidy, we appeal to the government to look at the exchange rate as nobody could go to black market to source for dollars and say it will not affect what will bought for sale.
We are seeking for the federal government‘s assistance, to remove the charges collected by NIMASA, NPA, NNPC, and others completely.
“In advanced countries, states can’t be ignorant of what is happening. The state government can come to our aid in terms of granting our members financial
support. They should allow investors meet Governor Seyi Makinde, to look for way forward
“On the quality imported product, it’s only the DPR, which is now called Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA, that has rights on matters relating to Petroleum products. All other security agencies that are poke-nosing to the issue of Petroleum should stay clear from it. For avoidance of doubt, the government should come out clearly to state the roles and right of any each agency. Agencies such as Customs, Police, NSCDC and others should be informed as they can’t determine whether the quality or quantity is of the Product is of right specification.
“The masses are hereby implored to bear with IPMAN on the issue of price, from now on, there will be price fluctuation. Price will be going up and down depending on the aforementioned reasons highlighted above. (dollar exchange rate and price of crude oil in the world market.) Apart from those two, if government can support us with funding and others, everything will be fine.
But internally, these charges should be looked into so that some of these levies and charges should not exist again.
The charges and taxes we pay on our turnover is way higher than our profit.
We want government to give us concession, especially with the Federal Inland Revenue Service, FIRS,” he concluded.
Mutiu also reminded that when the Ibadan Depot is about to be sold, FG should consider IPMAN members rather than the private investors.
