Commuters in Lagos State have expressed concern about the region’s impending fuel crisis. Not only is it difficult for motorists to obtain fuel, but transportation fares have also risen as a result of the scarcity of fuel.
The scarcity of fuel first appeared in October, when it hit various parts of Nigeria, forcing motorists to spend hours at filling stations battling for the product.
Black marketers charged between N300 and N400 per litre of gasoline in many regions of the nation.
However, since Monday, commuters have bemoaned the rise in transportation costs in the state, with gasoline costing between N195 and N200 per litre.
As of Wednesday, many gas stations either didn’t sell fuel or did so at exorbitant prices.
Investors King learned that some drivers were unable to fill up their vehicles from commuters at Agege. One of the commuters claimed that the inability to purchase fuel prevented him from taking his car outside. In a similar vein, the driver stated that he would park his car somewhere and board a commercial vehicle to travel to Lagos Island.
“As it stands, I’m going to park somewhere after I get the passengers out of the car so my friend can help me get fuel. Considering that I might spend up to three hours on the third mainland bridge, I cannot drive this vehicle to the island; it is not worth it.
According to an online report, queues were reported along the Alausa Secretariat road, as the NNPC (former Oando) was closed to motorists. The same situation was also noticed at Total filling stations in Ojota and Palm Grove on Tuesday.
The Independent Petroleum Marketers Association of Nigeria blamed it on the depots and the increasing difficulty in accessing petroleum products.
National Controller, Operations, IPMAN, Mike Osatuyi, reportedly said that members of the association could not get sufficient products at the depots.
“No fuel. Even when we were able to get small quantity, DAPPMAN sold it to us at N200/N202 per litre. By the time we transport it to our stations, the cost would be around N210/litre,” he said.
He added that getting petrol to members’ filling stations from the depots now cost as much as N200 per litre in some instances.
If the Federal Government moved forward with implementing the new tax regime, the executive secretary of the Depot and Petroleum Products Marketers Association, Olufemi Adewole, warned that the tax could force businesses to close their doors and exacerbate the scarcity crisis.
Adewole argued that petroleum marketing companies could not sustainably pay such a sum due to the inadequate trading margins of these companies.
Petroleum marketers have a very low operating margin, but their turnover is very high, according to Adewole. Regrettably, the margin does not reflect the turnover.
He revealed that marketers continued to receive the same margins when fuel prices increased to N160 and N200 from the margins they were receiving when a litre was sold for N40.
He stated, “The Finance Act 2020 states that the marketers must pay 0.5% of their gross turnover by the end of this year.
If the new tax regime is implemented, “it is unthinkable that probably half of the petroleum marketing firms existing now may go out of business,” he said, unless the regulator, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, approves a new margin for the marketers.
Oil Prices Hold Steady Ahead of Crucial OPEC+ Meeting Amidst Fed Rate Hike Signals
Oil prices maintained their significant gains as traders anticipate the outcome of a crucial OPEC+ meeting on supply while considering signals from the Federal Reserve regarding interest rate policies.
Global benchmark Brent hovered below $82 a barrel, having surged over 2% on Tuesday, while West Texas Intermediate traded under $77.
The OPEC+ meeting, scheduled for Thursday to set policies for 2024, is currently grappling with a dispute over output quotas for some African members.
The recent rise in crude prices is underpinned by a weakening dollar, with a Bloomberg gauge of the US currency reaching its lowest level since August.
Federal Reserve policymakers, including Governor Christopher Waller, have hinted at an impending pause in the series of rate hikes, contributing to the bullish sentiment in oil markets.
A softer dollar enhances the appeal of commodities for international buyers.
Yeap Jun Rong, a market strategist for IG Asia Pte in Singapore, commented on the interplay of factors, stating, “The US dollar was dragged lower on a build-up in dovish expectations, which was very much cheered on by oil prices.”
However, concerns persist about OPEC+’s ability to address the challenges in the oil market effectively.
Despite the recent gains, oil is on track for a consecutive monthly decline due to increased supply from non-OPEC countries, intensifying pressure on the cartel and its allies to consider more significant output cuts.
The International Energy Agency’s earlier assessment indicated a potential return to a global crude surplus in the coming year.
In the US, the American Petroleum Institute reported a 817,000-barrel decline in nationwide inventories last week, potentially marking the first drop in six weeks, pending confirmation from government data.
This development may add support to oil prices and impact the ongoing dynamics in the energy market.
Oil Prices Stabilize as OPEC+ Weighs Deeper Output Cuts Amid Global Supply Concerns
Market Evaluates OPEC+ Decision Amidst Bearish Sentiment and Global Supply Worries
A Relaxed Start to the Week But Much More to Come, OPEC+ Eyed
By Craig Erlam, Senior Market Analyst, UK & EMEA, OANDA
It’s been quite a calm start to the week which isn’t entirely surprising given the lack of events on the calendar today. That said, things are expected to pick up with the rest of the week serving up some big economic releases and a hugely important OPEC+ meeting.
All data now, particularly that of the US, is being looked at through the prism of what it will mean for the final central bank meeting of the year and the new projections it’ll be accompanied by.
Since the last meeting, the data has been encouraging and we’ll get another batch before the Fed meets on 13 December. This week we’ll get the October PCE inflation data – the Fed’s preferred measure – as well as third quarter GDP, ISM manufacturing and jobless claims.
Outside of the US, we’ll get flash HICP inflation data for the eurozone, PMIs from China, CPI figures for Australia and a rate decision from the RBNZ. On top of all that, there’s a plethora of central bank speakers making appearances which will keep us on our toes.
BoE Governor Bailey got the week off to a start on that front, pushing back against expectations for rate cuts from Q2, claiming he doesn’t expect any for the “foreseeable future”. A vague commitment as ever but all we can expect from policymakers for now. There’s still a way to go and as Bailey highlighted, getting from peak to now is likely to be much easier than from here to 2%.
Oil choppy ahead of Thursday’s OPEC+ meeting
Arguably, the OPEC+ meeting will be the week’s most impactful event. Not just because any decision could have direct consequences for price and therefore inflation but also due to the meeting already being pushed back by four days, so there’s clearly some disagreement within the alliance.
The group has always found a way to get an agreement over the line before, even if that means the biggest producers taking on more of the additional commitments so it’s probably safe to say something similar will be achieved this week. But the question is how far they’ll push it, given the recent trend in oil prices and increasing concerns around global growth next year.
Gold eyeing record highs?
Gold has got the week off to a strong start, up around half a percent and hitting a six-month high. It just about managed to end last week above the psychologically challenging $2,000 level – where it’s repeatedly been pushed back from over the last month – and it seems that has propelled it on today.
We’re still seeing some push back though but this break has been backed by softer US data in recent weeks and less hawkish commentary from the Fed. That may be the difference this time around and enable it to look up towards record highs, only a few percent above where it currently finds itself.
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