Nigeria’s persistent fuel scarcity rooted in inefficient distribution system, PENGASSAN claims

Business a.m.

The Petroleum and Natural Gas Senior Association of Nigeria (PENGASSAN) has attributed the persistent fuel scarcity in the country to the inadequate and obsolete fuel distribution system. 

Speaking at the 2024 PENGASSAN Energy and Labour Summit held recently in Abuja, Festus Osifo, the president, PENGASSAN, drew attention to the inadequacy of the fuel distribution network in the downstream sector of the oil and gas industry to meet the demands of Nigeria’s vast population. 

Highlighting the critical need for infrastructure and process improvements in the sector, Osifo emphasised that the outdated distribution chains were a major factor contributing to the persistent fuel scarcity experienced in the country.

In his words, “The distribution chain is weak in the downstream sector of the oil and gas industry. That is why today, you see queues in most of the stations. The problem may be solved today, but it will resurface tomorrow.”

Osifo identified several key factors contributing to the inadequate supply of fuel across the country, including the outdated and insufficient methods of product importation and distribution. 

According to the PENGASSAN president, Nigeria’s reliance on a single point of importation and the use of trucks to distribute fuel across the nation falls far short of meeting the needs of the country’s large and geographically diverse population.

Osifo further attributed the insufficient supply of fuel to bad roads and flooding, which can hamper the delivery of fuel to filling stations.

Osifo emphasised that without significant improvements in the country’s fuel distribution system, the issue of recurring fuel shortages is likely to persist.

He also mentioned additional challenges faced by the sector, including higher production costs compared to other parts of the world, which leads to increased prices for consumers.

In an effort to reduce these production costs, Osifo urged the government to take on security responsibilities from investors and strengthen the laws and sanctions against oil theft.

Furthermore, he called for stricter penalties to discourage unethical practices within the industry, promoting integrity and ethical behavior among all stakeholders.