Nigerian National Petroleum Corporation (NNPC) has after several spirited denial own up that the debts it owed international oil traders is a major factor in the ongoing fuel scarcity across the country. In a statement, NNPC spokesperson Olufemi Soneye confirmed media reports, attributing the fuel shortage to supply disruptions caused by outstanding debt obligations to international oil traders. While NNPC acknowledged this situation, the corporation did not disclose the exact amount owed to these oil traders. It will be recalled that international news outlets and online media had reported that NNPC was indebted to the tune of $6.8 billion in subsidy debts, making it challenging for the corporation to procure imported petrol products.
“NNPC Ltd. Has acknowledged recent reports in national newspapers regarding the company’s significant debt to petrol suppliers. This financial strain has placed considerable pressure on the Company and poses a threat to the sustainability of fuel supply. “In line with the Petroleum Industry Act (PIA), NNPC Ltd. Remains dedicated to its role as the supplier of last resort, ensuring national energy security. We are actively collaborating with relevant government agencies and other stakeholders to maintain a consistent supply of petroleum products nationwide,” Soneye said. NNPC Limited’s recent statement comes amid a severe fuel scarcity gripping the nation. This situation also suggests that the oil company may no longer be able to maintain the fixed price of petrol following so call removal of subsidy on May 29 2023.
NNPC said that it is seeking financial relief from the federal government, hinting that the company might rely on government intervention, possibly in the form of a subsidy, to navigate this financial crisis. The growing social anxiety over the potential return of the subsidy has intensified, particularly with various reports suggesting that the federal government may have reinstated the subsidy following the Naira’s devaluation. Although NNPC has yet to confirm the reintroduction of the subsidy, its recent statement suggests that the federal government may need to step in to help settle some of the company’s obligations to international oil traders.
