Petrol: Oil marketers may soon go out of business

Petrol: Oil marketers may soon go out of business – IPMAN

TNT Newsline March 15, 2021 2 minutes read

…says N6.49/litre margin no longer sufficient

…wants PEF scrapped

The Independent Petroleum Marketers Association of Nigeria (IPMAN), has raised the alarm that oil marketers may soon run out of business, due to an increasing cost of operation in the face of a small profit margin.

The marketers, who decried the uncoordinated manner in which government’s deregulation policy was being implemented, said it has left oil marketers without resources to run their operations.

IPMAN National Publicity Officer, Ukadike Chinedu, who spoke to newsmen over the weekend in Abuja, disclosed that the N6.49/litre margin was no longer sufficient, as oil marketers end up spending close to N9.5 million if they were to buy about 45,000 litres.

He said: “Let me tell you that we have become service oriented companies we are no longer talking about profit, we are just trying to stay in business.

Unfortunately, the government is not thinking about the continuity of marketers in business.

“I also want to make it clear that in the latest pricing template released by the PPPRA which they have just reversed, you will see that the margin they gave to marketers is N6.49 per litre and if we are buying about 45,000 litre we spend close to N9.5 million.

“The same volume we use to buy for about N6.5 million or there about with the same profit margin of N6.49, the implication is that while the cost of purchase is increasing by the day, the government still expect marketers to sell the product at the same profit margin even when we know that the cost of operating the business continues to increase.

“What this simply means is that independent marketers may soon go out of business because as it is now, it takes one close to a N100 million to bring products to a station and the margin of gain is so small and considering interest rates from the banks, it is obvious that marketers may go under very soon.”

Ukadike, who called on the Federal Government to scrap the Petroleum Equalisation Fund (Management) Board (PEF) and in its place make the 21 petrol depots across the country functional and accessible to oil marketers, said bringing the products closer to marketers would eliminate the need for PEF. (New Telegraph)