Tuesday, August 9, 2022
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Russia-Ukraine War May Worsen Fuel Scarcity In Nigeria As Oil Vessels Face Delay On Sea

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Due to the ongoing war between Ukraine and Russia, vessels conveying refined products could be hindered from leaving refineries in the warring region.

The fuel scarcity situation being faced nationwide may further be prolonged because the vessels that bring refined petroleum products into the country from countries around Ukraine and Russia are likely to face some delays.

According to report, due to the deficit in the supply of crude oil cargoes from the Nigerian National Petroleum Company Limited (NNPC), traders or contractors who supply Nigeria with refined petroleum products might pause a little.

Through its Direct Sale Direct Purchase arrangement, the NNPC brings refined fuel into the country in partnership with some contractors.

These contractors receive crude oil from the NNPC and in turn supply the national oil company with refined products worth the volume of crude received.

However, sources who spoke, have revealed that due to low oil production, the NNPC had a deficit of about 17 cargoes in its DSDP obligation.

This according to the sources could further prolong the fuel scarcity in the country.

The sources also added that the Russia-Ukraine war might worsen the petrol supply situation in Nigeria because vessels conveying refined products could be hindered from leaving refineries in the warring region.

“What we face now could be described as a perfect storm, which is when many things go wrong at the same time. We have a fundamental problem, but that problem happens at a time that other things happened and so it aggravates everything,” one of the sources said.

“Now, Russia has attacked Ukraine. What is the impact of Russia’s attack of Ukraine on Nigeria? Russia is an oil-producing country, for Ukraine, our refined products come from that part of the world, not only Western Europe.

“So, the price has gone up because our refined products come from that part of the world and disturbances such as the one happening there will impact supply one way or the other.”

Another source explained that the continued theft of crude oil could further prolong petrol scarcity in Nigeria.

The source said, “Nigeria is assigned about 1.7 million barrels of crude oil production per day by OPEC, but its production is between 1.3 and 1.4 million barrels daily. But that is a different thing. Now, from the about 1.3 million barrels that the country produces daily, people are stealing from it.

“They are creating holes in pipelines and the ones that they steal are used in illegal refineries in Rivers State, causing soothe and dirt in peoples’ lungs. The other ones that they steal, they put in batches and go to the high sea to sell them.

“Now the NNPC brings in products through Direct Sale Direct Purchase of crude. Now I’m telling you that the NNPC owes traders crude oil under the DSDP scheme and you know why? It owes crude oil because people are stealing the crude and they don’t have enough crude to pay.

The source maintained that the petrol scarcity problems may continue if something drastic was not done as soon as possible.

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