The Nigerian National Petroleum Company Limited (NNPCL) is grappling with severe financial constraints that could push the pump price of Premium Motor Spirit (PMS) to unprecedented levels. The company, which is currently the sole supplier of petrol in Nigeria, has admitted that the ongoing fuel scarcity and potential price hikes are directly linked to a $6.8 billion debt owed to international oil suppliers.
Olufemi Soneye, the spokesperson for NNPCL, confirmed on Sunday that the financial strain is jeopardizing the company’s ability to sustain fuel supply across the country. This revelation comes as the company struggles to manage the soaring costs of fuel importation, with the landing cost of petrol reported at ₦1,117 per liter as of July by the Major Energy Marketers Association of Nigeria (MEMAN).
Despite the government’s claim that fuel subsidies have been removed, NNPCL has recently acknowledged covering shortfalls in PMS importation costs, a move that has exacerbated its financial woes. The current pump prices, which range between ₦617 and ₦720 per liter, are now under threat as NNPCL considers its options to address the financial crisis.
MS Ingawa, an aide to the Minister of Housing and Urban Development, Ahmed Dangiwa, suggested that NNPCL may need to either increase pump prices or raise funds through asset or equity sales to offset the crippling debt. He made this statement on his X handle on Sunday, emphasizing that these measures might be the only immediate solutions available to the struggling oil giant.
The situation has raised concerns among Nigerians, who are already facing economic hardships due to inflation and the high cost of living. An increase in petrol prices could further strain household budgets and trigger widespread protests, adding to the growing discontent with the current administration’s handling of the economy.
