PPPRA Blames Fuel Scarcity On Naira Devaluation
BEVERLY HILLS, March 03, (THEWILL) – The fuel scarcity currently being experienced by several states in Nigeria has been blamed on the devaluation of the naira by the central bank, the Executive Secretary of Petroleum Product Pricing and Regulatory Authority, Senator Farouk Ahmed, said Tuesday, at the Nigerian Senate.
The central bank devalued the naira twice within three months (November – February), Ahmed told members of the Senate Committee on Petroleum (Downstream), when he appeared before them to explain the reasons behind the persistent unavailability of petrol.
The ruling PDP had earlier accused the main opposition party APC of orchestrating the scarcity to embarrass the central government ahead of the general elections starting in about three weeks away.
However, Ahmed said the devaluation complicated payments to marketers as the PPPRA was unable to determine the dollar-naira exchange rate to use to pay for imported petroleum products, which also made it impossible for marketers to deliver shipments of products on time.
“Non-arrival of cargoes made it difficult for petroleum motor spirit to be delivered. What actually complicated it was the devaluation of naira – two times. The first one that took place on November 28 devalued Naira from N155 to N168 to $1. The second one that took place on February 18 brought the exchange rate to N199 to $1. These two developments brought a lot of confusion into the oil sector, he said.
“Marketers were not sure of the actual delivery cost. We had to draw a new template as advised by the CBN. The delay we have now is caused by the November devaluation. But the reality is that the policy is clear now. The Minister of Finance, PPPRA and other agencies are working closely to ensure that outstanding bills are paid. On Monday, we got an approval from the Budget Office for payment of all outstanding bills. We have adjusted the template now. We have to put the exchange rate at the interbank rate. Now, we have a direction,” he added.