Why long queues are back in filling stations

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In the Lagos capital and its environs, more petrol stations yesterday closed to motorists while the ones that sold had long lines of cars. The price of petrol increased by between N205 and N220 per litre at the petrol stations. However, a few outlets run by significant marketers offered N185 per litre.

The sharp rise in operational costs that result from the current situation, in which marketers and depot owners struggle to find foreign exchange (FX) to continue their operations locally, is not unrelated to the revival of long queues at the pumps.

This suggests that depot owners and independent marketers are starting to avoid selling price as a result of the rising value of the dollar relative to the local currency and their inability to get such funds.

Olufemi Adewole, the Executive Secretary of the Depots and Petroleum Products Marketers Association of Nigeria (DAPPMAN), noted that foreign exchange has a significant impact on business. He said that earlier in the year, his members would chatter daughter vessels for their operations at a rate of $25,000 to $35,000. At the time, the exchange rate was N385 to $1.

The exchange rate once reached N900 but later fell to N750 a few days ago in the black market. "Today, we are chattering daughter vessels at $70,00 per day. Therefore, someone must bear this expense. Therefore, any expenses a marketer incurs in bringing the goods to you in the retail location must be recouped, according to Adewole.

Petrol Station
Petrol Station

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