That Nigeria, the 6th largest oil producing country in the world is currently languishing in scarcity of the premium motor spirit is no longer news. The yucky situation started about four weeks ago and now has constituted itself as a cog in the wheel of many economic activities in the country. The queues are getting longer, transport fare on the rise, restlessness on the road getting unbearable and yet the black markets continue to flourish. The past weeks have been a horrible experience on the road for many.
Many analysts have come out to blame the situation as government irresponsibility. Some went further to advice the government to stop the subsidy payment which they consider as a means for a few to fill their pockets. The analysis and accusations notwithstanding, Nigerians are suffering to get their cars, generators and many fuel consuming machines working. What exactly is the cause of this scarcity?
Last week, Nigerian oil marketers accused the federal government of non-payment of fuel subsidy debt. The marketers are holding the nation to a claim of about N413 billion. They allege the government of not releasing funds to backup the cheques released to them and until they do so, the situation will persist.
In response to these claims, the Minister of State for Petroleum Dr. Ibe Kachikwu said yesterday that there is enough supply in government facility that the queues are as a result of pipeline issues that is currently being addressed. He also added that the subsidy arrears will be paid to the marketers as soon as the national assembly approves. If this is the case, who then is fooling who? For how long are we going to suffer in this mess?
The government on one hand said the scarcity is artificial and caused by hoarding and on the other hand, it claim to await the national assembly’s approval to be able to pay the marketers. This situation leaves many questions hanging in the air begging for answers. Is the government incapable of paying the subsidy arrears or the Central Bank is unaware of the order or the national assembly is so busy that it cannot attend to the issue at the moment? What could be done to increase the supply of oil and save the situation?
As short term solution, the government should treat the debt with utmost urgency. The fact that the fund is available and is been delayed just because of national assembly approval is not good enough. They should be aware of the detrimental effects of this on an average Nigerian. A large number of artisans depend on fuel to sustain their business obviously due to the fact that power supply is unstable. Workers depend on public transport which now charge high to be able to commute themselves to their workplace because they have no choice. The close substitute which is the rail transport is as good as not functioning.
In the long run, the government should set all its machinery in motion to avoid future re-occurrence of scarcity. Specifically, it should in a way put an end to the recurring issue of fuel subsidy. The Buhari administration should either take full charge of the petroleum sector or deregulate it to allow more participation of the private sector players.
Increased participation of the government will not only reduce the corruption that rids the middlemen syndrome in the sector but also improve the supply of oil. The government should invest hugely in the resuscitation of the moribund refineries, regulate the prices of stock and set the rules of the game for the players in the industry. Further, the government should ensure that the bodies regulating the sector are working to capacity to avoid the very many obnoxious acts perpetrated by marketers and oil retailers.
On the other hand, if the government decides to deregulate the downstream sector of the industry, it must champion the cause in a well monitored process to avoid monopoly and dictatorship. With deregulation, only genuine marketers who have the resources will be involved in the importation of oil. Just as in the telecommunication sector, it will create competition among marketers and subsequently crash the price of oil.
Moreover, the government may also device a workable public-private partnership. In this setting, the government should focus more on the legal and price fixing responsibility while the private sector should be left to the production supply and sales of the products. The government should also do more in regulating the activities of the retailers who most times fix their prices and create artificial scarcity.
With these set in motion, the issue of fuel scarcity will soon become a thing of the past. Every Nigerian deserves the privilege of driving into the filling stations and getting petrol at the instant. They deserve to get the products which was bestowed on their land by nature as at when needed and at affordable prices. The onus now lies in the government to keep it at such and end the unending suffering of fuel scarcity.
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