As the price of Automotive Gas Oil (diesel) continues to rise over N650 per litre in some quarters as of Thursday, transporters and other users have noted that it is raising their cost of business.
In Abuja, a trucker confirmed the product was sold for N670 Thursday. “The cost is getting high every day from N450 two weeks ago. Now we are buying at N670 per litre,” said Adamu Yusuf.
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An industrialist and sachet water manufacturer, Onuoha Okorie, said if the price hike continues, the association of table water producers (ATWAP) may be forced to raise unit cost. Just in August 2021, the group raised the wholesale price per bag from N100 to N200 while it was sold at N250 in retail shops and N20 per sachet.
In Lagos, diesel sold for between N610 and N645/litre in some fuel stations. A supplier of sachet water in Ikeja said the rise is affecting operation, coupled with the epileptic power supply. While some factories are not producing water at all, those producing have increased the price from N120 per bag to N150 while those who retail sell at N200 per bag.
Commenting on the situation, an Economist and CEO of Centre for Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf said NNPC Ltd cannot continue to provide the fuel needs of the entire country as it is not sustainable. “This approach would consume the entire revenue of the government,” he said.
Yusuf also said most firms still depend on diesel generators to power their operations in the face of epileptic electricity supply, noting that the diesel price hike could escalate product prices.
Diesel unaffordable globally – NARTO
Responding to the rising diesel prices, Nigerian oil marketers have blamed the ongoing war between Russia and Ukraine.
Speaking at the Annual General Meeting of the National Association of Road Transport Owners (NARTO) in Niger yesterday, the National President of NARTO, Yusuf Lawan Othman, said the price of diesel is becoming increasingly unbearable for his members.
Othman who lauded the federal government for increasing the freight rate for transporters, however said diesel price hike is raising the logistics business cost.
He said, “It’s usually at the international price and everybody knows that the international price is affected by the current war in Ukraine and Russia. So of course, because we import it, it’s really very costly.”
Aside from the high cost of diesel, the NARTO president appealed to the federal government through the minister of works and the N621bn NNPC road intervention for 21 critical federal roads as he said bad roads cause fatal accidents.
The oil marketers also shared their pain as the Executive Secretary of Major Marketers Association of Nigeria (MOMAN), Clement Isong, sympathised with transporters, calling on the federal government to intervene, although the diesel market is liberalised.
The National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN), Alhaji Debo Ahmed, also said the cost of diesel has become unaffordable even for the marketers.
Commenting at the event, the Executive Secretary of Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Farouk Ahmed whose agency regulates the downstream petroleum sector, pledged commitment to the transporters with the Petroleum Industry Act (PIA).
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