10,000 Filling Stations Face Closure Amid Fuel Consumption Downturn
Approximately 10,000 filling stations in Nigeria are on the verge of shutting down due to a significant decline in fuel consumption. According to data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), petrol consumption plummeted by 92% from 60 million liters in May 2023 to 4.5 million liters in August 2024.
Key Factors:
- Removal of fuel subsidy in May 2023 led to a 488% price surge.
- Petrol prices soared from N175 per liter to over N1,000.
- Only 16 out of 36 states receive petrol from NNPC.
- High prices caused massive losses for oil marketers.
Consequences:
- About one million workers risk losing jobs.
- Petroleum Products Retail Outlets Owners Association of Nigeria (PETROAN) members face huge losses.
- Independent Petroleum Marketers Association of Nigeria (IPMAN) confirms decline in fuel consumption.
Meanwhile, Dangote Petroleum Refinery shipped 79 million liters of petrol to Lagos, achieving its first sea petrol dispatch. The refinery aims to reduce Nigeria’s reliance on petrol imports.
Context:
- President Bola Tinubu removed fuel subsidy in May 2023.
- Nigeria’s inflation rate stands at 32.70%.
- Dangote Refinery begins direct petrol sale to marketers.
The development highlights the challenges facing Nigeria’s petroleum sector and the impact of price hikes on businesses and consumers.
