Subsidy removal: Ex-depot price rises from N172 to N580 – IPMAN

The Chairman of the Independent Petroleum Marketers Association of Nigeria (IPMAN), NNPC Depot, Ore Western Zone of Nigeria, Engineer Shina Amoo, has lamented that the ex-depot price of fuel has skyrocketed from N172 to N580 per litre, sequel to the removal of fuel subsidy….CONTINUE READING...CONTINUE READING

He stated that before deregulation or fuel subsidy withdrawal, they bought fuel at an ex-depot price of N172 and sold at N190 or N195 as a pump price but, according to him, now, the ex-depot price has hit N580.

He alleged that some private depot owners now sell fuel to them at N580 per litre as an ex-depot price, whereas, according to him, the depot owners still sell at a pump price of N580 at their own filling stations.

He stated that life has become unbearable for many marketers, following the skyrocketed fuel pump price, which, he said, had led to abysmal patronage.

In an interview with journalists on Friday, he also said many IPMAN members are now grappling with business frustration and financial losses.

According to, because of low sales, many marketers cannot break even. He added that some of them have converted their filling stations to car parks, car marts, abattoirs, and event centres.

He also said many of them were having issues with their banks and that banks now decline credit facilities to some marketers.

The IPMAN Ore depot chairman also decried that some oil marketers have even fled the country because of business failure and financial challenges.

He called on the government to make it possible for them to buy at an ex-depot price that would allow them to compete favourably with major marketers and depot owners.

The IPMAN Ore depot Chairman also pleaded with the government to make it possible for their members to access financial facilities, including grants, and that their filling stations should also be used for the Compresses Natural Gas (CNG) conversion.

Amoo said, “Deregulation is the best regime in our sector but the problem with this current regime is that our refineries are not working. Dangote Refinery which we believe will open is not ready. All our government-owned depots are abandoned. All the pipelines are vandalised. There is no solution to the free flow of the product in the country. We are still on importation. That is what we are facing now.

“More than 60 per cent of independent marketers are seriously affected. We are not doing something, we just go to work. We are now selling a ridiculous volume. There is nothing much we are doing. They are selling to us as ex-depot prices the pump price they sell at their stations and we are expected to compete favourably with them. Whereas we also incur transportation costs and other costs. As we sell N600, they sell N580. Which customer will patronise us when he can get it at N580 as we sell N600?

“Before they removed subsidy, for example, two or three years back now, many of us could not enjoy the advantages of our licenses, meaning, we had not been getting the product from government depots officially. Many of us had been buying at premium up and down.

“Now that there is deregulation and subsidy has been removed, we expected an advantage of getting the product from the private depot owners at ex-depot prices. But as I talk to you, many of the private depot owners are selling to us at their pump price rate as ex-depot price.

“With this development, many of our members are out of business. What we are looking out for is how the government can come to our aid and allow independent marketers to operate. If it is possible for government to organise for a depot that will allow us to have a margin so that we can sell at the same pump price with private depot owners. Many of our people are no longer in business, many of them are on ‘japa’ syndrome, and many are idle. The problem is that they cannot access the product at the official rate or at the rate that allows for margin. The situation is that we buy the product and we sell it at a price that we do not make any profit. Many of our people have sold their petrol stations and others have put their stations on to let for lease or for sale.

“Before deregulation, we could get the product for N172 and sell the product at our stations for N190 or N195. From the margin of N23, we pay for transportation and other logistics and have small money as profit. But now we buy N580 from private depot owners and well sell in our station N580, some sell N590. When you transport, for instance to Akure N15, and to Ibadan N10. When you transport with N10 to Ibadan, that is N590 and we are selling at N590, but the private depot owners will be selling N580 as the pump price at the stations and will be selling the same amount to us as the ex-depot price.

“That is making our people to be out of business. Some marketer have turned their stations into car sales. Some have turned their own to car lots, and event centres and some are even growing weed. Many of our petrol attendants are jobless.

“Before deregulation, we were buying a truck of Premium Motor Spirit (PMS) for less than N9m but now we are buying at N26m.

“A lot of our people are now facing bank challenges. For some of them, the banks now refuse to grant them loans because they know that the business is no longer lucrative. Only a few of us who are still in business who are rugged can still access credit but many of our people can not access credit because the bank is afraid that they may not pay back. When you want to borrow money and the bank is afraid and is giving you an analysis of the business that it is not profitable, the bank has given you a signal that it may not be possible for the facility to be granted to you.

“So that we are not pushed to the wall, government should look into our plight. The government should look at the possibility of designating a depot so that we can request from the platform of Nigerian National Petroleum Company Limited (NNPCL) that gave license to us where we can get the product at a reasonable ex-depot price so that we will have a margin or small profit. We are the largest operators in this business. Go to any corner of this country, you will see independent marketers.

“The government can give us a grant for Compressed Natural Gas (CNG) conversion. It can do that through a development bank. On the CNG, the government should support us to engage in gas sales as we are losing fuel volume to gas. This will help us offset the loss of revenue from fuel….CONTINUE READING