Why Kerosene Is Sold above Pump Price – IPMAN

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Kerosene queue in Lagos
Kerosene queue in Lagos

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The Independent Petroleum Marketers Association of Nigeria says kerosene is selling above official pump price because its members do not get the product at the official price due to corruption plus the fact the downstream sector is not liberalised to attract investors

| By Anayo Ezugwu | Oct 24, 2016 @ 01:00 GMT |

THE Independent Petroleum Marketers Association of Nigeria, IPMAN, has explained that oil marketers are selling Dual Purpose Kerosene, DPK, at N180 per litre, above the pump price because they could not access the product at the official price. The Petroleum Products Pricing Regulatory Agency, PPPRA, pegged the office price of kerosene at N135 per litre.

Abubakar Maigandi Dankigari, national vice president, IPMAN, revealed that corrupt practices still characterised the sale of kerosene because the product is still subsidised.

“Let government deregulate that PMS and DPK because there is still some element of corruption in the sale of kerosene. I seek the deregulation of the price of kerosene because of the difficulties in accessing it. Masses are not enjoying it and we marketers are not enjoying it because even when you go to any government depot that you want to load DPK now, you cannot load it at the government stipulated rate until you give them money before you can load it. The government’s price is N135 but you cannot get it. You can only come to town and get it for N160 and N170. That is why you see marketers selling it at N180 per litre,” he said on Wednesday, October 12.

Dankigari told the Nation that IPMAN was yet to kick-start the building of its proposed modular refineries because the federal government was yet to deregulate the price. He noted that had government deregulated the prices of the Premium Motor Spirit, PMS, and Dual Purpose Kerosene, DPK, IPMAN would have approached its foreign partners for investment in the projects.

According to him, building modular refineries is a gigantic project that an individual could hardly undertake without the involvement of foreign investors. “Up to the present date, the PMS and DPK are not completely deregulated. And a project like this, an individual cannot sponsor it. We will have to bring in foreign investors. And supposing the DPK and PMS are completely deregulated our foreign investors are ready to bring the money so that we can continue the business.”

Dankigari, who urged the government to deregulate the pump prices of petrol and kerosene, noted that its members could not import the products because of the devaluation of Naira which affected access to foreign exchange. Citing an example of the benefits of full deregulation, he explained that marketers were importing diesel because government had deregulated the product.

“We are importing diesel. What we are not importing is kerosene and DPK because of the present change in the value of Naira to dollar. We cannot go and import because of the rate. The government rate of kerosene is N135 per litre and PMS the government rate is N145. We can import diesel because of the liberalisation. There is no subsidy in diesel therefore if you import, you can add your margin and sell. The market of diesel is good as most of our marketers are selling it in their pump at the rate of N180 to N190 per litre.”

He said the people can now access petrol because of the partial removal of subsidy which brought the pump price to N145 per litre. He said the forces of demand and supply have reduced the PMS price in most independent petrol stations across the country.

“The sale of petroleum products is good because there is availability of diesel, PMS and DPK. Since there is availability of products, our staff are busy selling. A.A. Rano is selling at the rate of N141, Garima in Kubwa, we are selling at the rate of N142, Azman and the rest of them are selling at the rate of N142. We thank God that some government refineries have started functioning. Port Harcourt and Kaduna Refineries are now functioning. So they are assisting in terms of supply.”

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