Mr. Festus Osifo, the President of the Petroleum and Natural Gas Senior Association of Nigeria (PENGASSAN), shed light on the reasons behind the enduring queues at petrol stations nationwide.
Addressing attendees at the ongoing 2024 PENGASSAN Energy and Labour Summit in Abuja, Osifo specifically pointed to the inadequate and outdated distribution networks as a primary factor contributing to the queues.
Highlighting the challenges, Osifo remarked, “The downstream sector of the oil and gas industry faces a weak distribution chain, resulting in the prevalent queues at stations. While a fix might temporarily resolve the issue, it will likely reoccur.”
“Nigeria’s distribution system is antiquated and insufficient to meet the demands of its vast population. Unlike other countries of similar size and population, Nigeria heavily relies on a singular point for product importation and uses trucks for nationwide distribution,” he added.
Osifo, as reported by NAN, also linked the insufficient fuel supply in stations to challenges like poor road conditions and flooding, exacerbating the scarcity issue.
Calling for immediate reforms to tackle these hurdles, the PENGASSAN president urged the government to revamp and reinforce the country’s value chain for a more efficient and dependable distribution system.
He cautioned that without such enhancements, Nigeria would grapple with recurrent fuel shortages, emphasizing that the sector also wrestles with elevated local production costs, pegged at 15% to 20% higher than global standards.
Attributing the high production costs partly to security burdens on oil and gas firms, Osifo advocated for the government to assume security responsibilities from investors to significantly slash production expenses.
Furthermore, he called for stricter regulations and penalties against individuals involved in oil theft, advocating for stiffer consequences to deter malpractices and promote integrity within the industry.