Oil Dealers Threaten Shutdown Over Forex Crisis

Oil Dealers Threaten Shutdown Over Forex Crisis

Oil and gas dealers in the country have declared that the harsh operating environment in the downstream oil sector has led to the collapse of about 70 per cent of businesses in the industry, stressing that the over 200 members of NOGASA may withdraw their services from next month if the government fails to act fast.

The oil and gas dealers under the aegis of the Natural Oil and Gas Suppliers Association of Nigeria spoke after a resolution of its executive committee meeting in Abuja on Wednesday.

NOGASA, an association of oil and gas suppliers in Nigeria., promotes the interests of the oil and gas supply industry. It has a membership of over 200 companies, including major international oil and gas companies, as well as indigenous Nigerian companies.

The President, NOGASA, Benneth Korie, who conveyed the resolutions of members of the association after their meeting, stated that the government should peg the foreign exchange rate at N750/$ in order to enable refineries to start pumping out refined products.

Speaking on why the over 200 members of NOGASA could be forced to withdraw their services, Korie said it was becoming increasingly difficult for oil marketers to fund their operations, a development that led to the shutdown of 70 per cent downstream oil sector businesses.

“Another issue is that of high bank interest rates. Today if you want to buy one truck of PMS, you will spend N30m. And if you go to a bank to get N30m at over 30 per cent interest rate, you know how much you will pay to the bank, all in the name of inflation.

“So if care is not taken, we will also withdraw our service because there is no way out. 70 per cent of oil traders are out of business, so it is better that the government looks into this issue before it gets out of hand. Many of them (operators) cannot talk but they come to us to complain.

“So we just want to tell the Nigerian government that if something is not done from now to the end of this month, it will affect the marketers. Everybody is struggling to get money from the bank. From the 1st of next month, we will withdraw services if nothing is done,” Korie stated.

Nigerians are eagerly awaiting the release of refined petroleum products from both the multi billion dollar Dangote and Port Harcourt refineries, as this is going to positively impact on the supply of fuel nationwide.

Forex crisis, inflation, among other economic challenges have been a challenge to operators in the oil and has sector.

Check Also

Reps Pledge To Address Electricity Tariff Hike

The House of Representatives will intervene in the recent increase in electricity tariffs by the …

Leave a Reply

Your email address will not be published. Required fields are marked *

× Get News Alert