Banks are set to increase funding of petrol importation to N3.5 trillion as more marketers move to import the product amidst the push for the exclusivity of local production and supply led by Dangote Refinery.
Financial Vanguard learnt that banks are now receiving more loan requests for funding petroleum products imports with the head of oil and gas in a tier-1 bank saying about N250 billion single request came to his desk last week, the third in the last month.
He estimated the banking industry funding of petrol imports to be around N3.5 trillion before the end of this year.
He stated: “We have started seeing a lot of petroleum marketers coming up with loan requests for importation of products, which we didn’t have before now not even when the President declared that subsidy is gone.
“We have also done our due diligence on the market and discovered that deregulation is gaining traction across the private and public sectors.
“Before now we do not entertain lending to petrol marketers due to issues around pump price regulations because many banks had burnt their fingers in the recent years over oil and gas related loans that failed.”
Meanwhile the Nigeria Labour Congress, NLC, has alleged that the pump price of petrol is higher than market price, accusing marketers of ripping off Nigerians.
NLC in a communiqué at the of its National Executive Council, NEC, in Port Harcourt Rivers State, by its President, Joe Ajaero, noted with “increasing dismay the shenanigans around the appropriate pricing of petrol, (Premium Motor Spirit, PMS) in Nigeria.”
NLC observed that there may be a gang up against Nigerians by fat cats in the industry as the current price of the product is significantly higher than the real market price. Padding of costs and abnormal margins seems to be the order of the day considering the revelations from the ongoing controversy between Marketers and the Dangote group. It is entirely possible that Nigerian workers and masses are being ripped off by those who control the levers of Economic power in Nigeria which explains why the domestic public refineries may not immediately be allowed to come on stream.
Supporting NLC’s position, experts and other stakeholders, weekend, said at the current price of $72 per barrel of crude oil, the price of Premium Motor Spirit, PMS, also known as petrol, should be cheaper in Nigeria.
They said the current price of N1, 025 per litre (Lagos) was taken when crude oil, a major feedstock stood at more than $80 per barrel in the global market September 2024.
Since then, they said the price of crude has been volatile before dropping to the current $72 per barrel, without reflecting in the domestic price of petrol.