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ENERGY-NIGERIA: Rumours of Price Hike Trigger Fuel Queues

Toye Olori

LAGOS, Sep 30 2003 (IPS) - Economic activities in Nigeria’s largest city Lagos have been paralysed as rumours of an impending fuel price hike prompted long queues at filling stations.

The queues became noticeable late Monday as rumours filtered through that President Olusegun Obasanjo would announce a fuel price increase in his Independence Day broadcast Wednesday.

Dealers were having a field day Tuesday as motorists, who could not join the chaotic queues at filling stations, resorted to buying from the parallel market. A litre of petrol at the parallel market sells for 50 Naira (U.S. cents) as against 34 Naira (34 U.S. cents) official pump price.

The fear of an impending increase in the prices of petroleum products was further confirmed late Monday by the Minister of Labour and Productivity, Hussaini Akwaga who said in Ilorin, central Nigeria, that consumers should expect an increment of between 35 (35 U.S. cents) and 45 Naira (U.S. cents) per litre. Akwaga said the new prices might be announced in October, but did not announce the date.

”If if is 35 Naira or 45 Naira per litre that can make fuel available, please let us accept it,” Akwaga was quoted as saying by the local media.

But the Nigeria National Petroleum Corporation (NNPC) has refuted rumours that the queues at filling stations were due to plans by government to embark on another round of increases in fuel prices.

Ndu Ughamadu, NNPC spokesperson, said government has no plans to increase the price of fuel on Independence Day (Oct. 1) as is being speculated. He attributed the queues to panic buying and hoarding by dealers.

”Some Nigerians believe that something drastic (in the oil industry) will happen on Oct. 1. But government has no plans to increase the price of fuel,” he said.

Ughamadu said government has been importing fuel to meet local demands, and called upon private sector to supplement that effort by supplying more fuel.

This week’s fuel scarcity and resultant queues have prompted commercial vehicle operators to raise their fares. As a result, a journey between Lagos suburbs of Iwaya and Oyingbo, which used to cost 30 Naira (30 U.S. cents) Monday morning, now costs 40 Naira (40 U.S. cents).

Addressing passengers, a mini-bus conductor said: ”I cannot take 30 Naira as fare after staying at the filling station for more than three hours without working, while petrol attendants and touts extorted money from me. If you can not pay, better get down and wait for other vehicles; they may take your 30 Naira”.

IPS noticed that, while some of the passengers disembarked, others who were in hurry to get to work, stayed. They blamed President Obasanjo for dancing to the tune of the International Monetary Fund (IMF) which is urging Nigeria to liberalise its inefficient oil industry.

”Obasanjo is far removed from the masses. He does not experience the sufferings that we go through. If not, he will not be thinking of increasing fuel price again in three months,” a passenger who gave her name only as Catherine told IPS.

Obasanjo’s administration was forced through a mass protest and strike action by labour unions in June to bring down the price of petrol from 48 Naira (48 U.S. cents) to 34 Naira (34 U.S. cents) per litre. Before the last increase in June, petrol cost 22 Naira (22 U.S. cents) a litre.

The Nigeria Labour Congress (NLC) – the umbrella body of 29 unions – and rights groups are poised for a showdown with the government should it announce any increases.

The NLC, at the end of an emergency meeting of its Central Working Committee in Lagos Monday, resolved to resume its suspended nationwide strike if it is confirmed that the government is planning to deregulate the oil sector.

Adams Oshiomhole, the President of NLC, said the proposed deregulation would translate into further increases in fuel prices and more hardships to the masses. He said the resumption of the strike would be necessary as Nigerians are yet to readjust to the adverse effects of the recent increase.

”Congress strongly advises government to refrain from any action that will further increase the prices of petroleum products, as such increase will be resisted. We shall have no alternative than to resume the strike and mass protests if unilateral increases are imposed,” Oshiomhole warned.

The implications of the increment, he warned, would be very grave. They would, he said, include higher cost for energy, galloping inflation, mass retrenchment and increased poverty and the disruption of the All African Games scheduled for Oct. 4 in Nigeria.

”The price hike and mass action will have terrible effects on the image of Nigeria as it would be hosting other African nations during the 8th All African Games billed to begin on Oct. 4,” he warned.

The Trade Union Congress and the Nigerian Bar Association (NBA) have also advised against any price increase.

The NBA, in a statement, called on government to address the issue of fuel scarcity rather than increase prices.

It called for the setting up of a commission of inquiry to determine how much was spent by government on the maintenance of Nigeria’s refineries.

Nigeria has four refineries which have been producing below capacity due to lack of maintenance. Nigeria, the sixth largest producer of crude oil in the world, supplies about two million barrels a day to the world market.

The Lagos-based Committee for the Defence of Human Rights says if Obasanjo insists that the only option for his government was to hike fuel price, he should seriously consider vacating Aso Rock, the State House in Abuja

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