The Major Oil Marketers Association of Nigeria has recommended a gradual price deregulation for Premium Motor Spirit, also known as petrol, to reduce the subsidy burden on the nation.
MOMAN said the move should be supported with targeted palliatives in areas such as transport and agriculture.
Olumide Adeosun, Chairman, MOMAN, made the recommendation at a news briefing on Wednesday in Lagos while reacting to the recurrent scarcity of petrol in the country.
Adeosun said: “MOMAN, as an association, fears that the current supply framework cannot guarantee steady and consistent supplies to the country given the current state of government finances and unpredictable international supply shortages.
“We, therefore, recommend a gradual price deregulation with targeted palliatives (eg. transport and agricultural subsidies) to the public to ease implementation.
“However, in the interim, MOMAN recommends that the current single supplier strategy be reviewed.”
Adeosun urged the Ministry of Petroleum Resources, Ministry of Finance and other relevant agencies to set up a task force to immediately focus on increasing diesel supply through accelerated initiatives to increase local modular refining capacity.
According to him, this move will tackle the supply and distribution challenges.
He also called for a phased rehabilitation of the nation’s refineries to hasten supply of diesel and aviation fuel to reduce cost of transportation in the country.
Adeosun explained that the current scarcity was occasioned by two main reasons, which were inadequate supply and distribution challenges created by the unavailability and continuous surge in international prices of diesel.
He said the supplies received at the Apapa Jetty, according to the Pipelines and Product Marketing Company, showed that marketers received 438,800 metric tons of PMS in April.
The MOMAN chairman said the supply dropped to 213,100MT in May and 140,000MT so far in June, excluding the 64,000MT that was currently being discharged at the jetty.
While empathising with Nigerians on the situation, he said MOMAN members were working with all the petroleum industry stakeholders to make the product available at the pumps and eliminate the queues as quickly as possible.
He said the association would continually do its best to distribute petrol to its customers across the country and keep exploring opportunities to partner with industry stakeholders, the agencies and the government to ensure the sustainability of the downstream sector.
Adeosun, however, noted that the full deregulation of the downstream sector and full implementation of the Petroleum Industry Act, 2021 were the most viable long-term solution to the country’s supply and distribution challenges.