The federal government has approved the payment of N413 billion to oil marketers being the outstanding payments for subsidy claims.
The approval is coming on the heels of a brewing fuel supply crisis over non-payment of the subsidy claims, leading to queues in petrol filling stations in some major cities.
A statement by the Nigerian National Petroleum Corporation (NNPC) announcing the approval on Wednesday said the payment would be ‘immediate’.
NNPC noted in the statement from its Group General Manager, Public Affairs Division, Ohi Alegbe, that the corporation had also stepped up measures to eliminate the noticeable fuel queues in some petrol stations across some major cities in the country with the supply of additional volumes of petrol.
It said that the approval would bolster its initiative to ensure zero fuel queues.
“It is our belief that with the outstanding payment due to oil marketers now assured, the marketers and other downstream players will join hands with the NNPC to guarantee that the nation remains wet with petroleum products all year round,” it further stated.
NNPC explained that in line with its drive to ensure zero fuel queues ahead of the forthcoming yuletide and beyond, it was working assiduously with its downstream subsidiary company, the Pipelines and Products Marketing Company (PPMC), and other downstream players to consolidate the prevailing stability in the supply and distribution of fuel nationwide.
“Apart from increasing the volume of products distributed to stations across the country, inspection team from the PPMC have been commissioned to go round our operational areas to ensure compliance with laid down rules regarding loading and product evacuation across board to eliminate hoarding and other vices detrimental to the free flow of products,” NNPC said in the statement.
The Department of Petroleum Resources (DPR) in another statement disclosed that about 365 million litres of Premium Motor Spirit (PMS) were available in depots nationwide, while additional 800 million litres would be discharged before the end of the week.
DPR said the country had a stock level that would last for 30 days, adding that it had set up a 24-hour surveillance monitoring team of petrol stations nationwide to ensure unhindered sale of products at government regulated prices.
According to the regulatory agency, the surveillance was in response to reported cases of panic buying in some petrol stations across the country.
“To further ensure the supply of products, DPR has fast tracked the grant of product import permits and vessel clearing process to aid rapid stock build up for importers.
“We hereby appeal to all Depots and Petroleum Product Retail Outlets nationwide to ensure that products are sold at government regulated price as the DPR will not hesitate to enforce necessary sanctions against any erring marketer,” the statement added.
It advised motorists and other users of petrol not to engage in panic buying as there was adequate supply of petroleum products nationwide.
In another development, a five-yearly internal report by the Organisation of Petroleum Exporting Countries (OPEC) has predicted that the global demand for the cartel’s crude oil will continue to drop in the next few years, thus questioning the strategy put in place by the cartel to defend its market share in the global oil market.
The draft report of OPEC’s long-term strategy, seen by Reuters, forecasts crude supply from OPEC – which has an output target of 30 million barrels per day (bpd) – falling slightly from 2015’s level until 2019, unless output slows faster than expected in non-OPEC.
OPEC governors, official representatives of the 12 members of the cartel, met at the group’s Vienna headquarters yesterday to approve the final draft of the report.
The 44-page report, marked “CONFIDENTIAL,” according to Reuters, includes an annex containing comments from two members, Iran and Algeria, suggesting that OPEC should return to its old policy of propping up prices at a desired level by reducing supplies to the market.
Iran, Algeria and other poorer members have consistently insisted that OPEC should curb output to prop up prices but Saudi Arabia and its Gulf allies have resisted this proposal on the grounds that reducing supply to the international market would make them to lose their market share to non-OPEC members.
According to Saudi and its allies, OPEC would only cut output if the non-OPEC members would agree to curb supply to the market as well.
“Reaching agreement on a fair and reasonable price of oil for the next six to 12 months” is one of the steps that Iran recommended for OPEC.
“OPEC production ceiling should be set for six or 12 months intervals,” Iran also recommended.
OPEC oil ministers will meet on December 4 to decide whether to extend the strategy of allowing prices to fall to slow higher-cost rival supply.