The Nigerian National Petroleum Company Limited has a new financial need of around N10 billion to cover the cost of lifting petroleum from its ships, and many depot owners may soon be forced to close their facilities as a result of their failure to pay this demand.
Since President Bola Tinubu announced the elimination of the gasoline subsidy on May 29, they are already short on supplies many depot owners ran out of stock. Because banks are wary of lending to the downstream industry, many depot owners would not be able to acquire financing, the source continued.
Before the elimination of subsidies, the price of gasoline at the pump was between N179 and N200 per litre, but it has now soared to almost N500 per litre.
According to Oyebanji, several businesses in the downstream sector would be forced to shut down operations and may be bought over by bigger ones due to their inability to meet up with the huge financial obligations to secure new products from the NNPCL. Sources at the NNPCL said the company had been having challenges accessing forex from the Central Bank of Nigeria, since the removal of petrol subsidy.