What is Causing Nigeria’s Fuel Scarcity?

Fuel scarcity is causing problems again in Nigeria, especially in the Federal Capital Territory, Lagos, and other areas. The Nigerian National Petroleum Company Limited (NNPCL), which is the only company that brings petrol into the country, says the main issue is with getting the fuel to the places where it’s needed. 

This is creating a lot of trouble for people who need fuel for their cars and businesses. NNPCL is working hard to fix these problems quickly. 

Let us look at why there is fuel scarcity and what NNPCL is doing to solve it.

1. Distribution Challenges

The Nigerian National Petroleum Company Limited (NNPCL) has identified distribution issues as a primary cause of the current fuel scarcity. This might involve logistical difficulties in transporting fuel from depots to various filling stations across the country, leading to uneven supply and availability.

2. Sole Importer Constraints

NNPCL is the sole importer of petrol in Nigeria, which can create bottlenecks in supply, especially if there are delays or problems within the company’s procurement or importation processes. This centralisation of importation can exacerbate scarcity if any part of the supply chain faces disruptions.

3. Panic Buying

The anticipation of actual fuel scarcity often leads to panic buying, where motorists and other consumers purchase and hoard fuel, exacerbating the scarcity. This behaviour can lead to a rapid depletion of available fuel supplies, making the situation worse for everyone.

4. Regulatory Issues

The Nigerian Midstream and Downstream Petroleum Regulatory Authority has had to warn filling stations against the illegal sale of petrol, indicating regulatory challenges and possible non-compliance by some distributors, which can disrupt the intended flow of fuel distribution and availability.

5. Inadequate Infrastructure

In many cases, the infrastructure needed to store, transport, and distribute fuel efficiently across the country is either inadequate or in disrepair. This can lead to delays and inefficiencies in the fuel supply chain, contributing to periodic scarcities.