2007, a BusinessDay investigation has revealed reveal.
Business leaders who spoke to BusinessDay attributed the rise in diesel consumption to the to booming sale of high capacity and diesel consuming generators in the face of the worsening power situation in the country.
“If electricity is provided the way it should be in this country, there will be less pressure on the use of diesel to power generators and this will reduce the cost of the product,” said Emmanuel Ijewere, chairman Longman Nigeria plc.
Ijewere, who is also the chairman of Best Foods Global Nigeria Limited, said the situation was worsened by the inability of the refineries to refine enough diesel for domestic consumption.
Nigeria�s domestic diesel consumption has been increasing even as major marketers are asking questions over government�s allocation of the diesel produced at Warri and Port Harcourt refineries.
Kaduna and Warri refineries produce 1.8 million litres and three million litres of diesel per day, respectively. This quantity is allocated to marketers in a manner which major marketers say lack transparency. Zenon Oil, for instance, received only 20,000 metric tonnes of the product since the beginning of this year, according to a senior official of the company.
Major marketers said they do not get allocation as most of the product goes to Independent Petroleum Marketing Association of Nigeria (IPMAN).
Odein Ajumogobia, minister of state for petroleum (energy), had accused marketers who lift diesel from the refineries of selling to consumers at prices of imported diesel.
Marketers who lift from the refineries are supposed to sell at N60 � N70 per litre.
The minister threatened to make the affected marketers to refund extra gains they made from such transactions.
A committee to be headed by Tony Chukwueke, former director of Department of Petroleum Resources (DPR) had been set up to look into the issue. Even the marketers who got allocation complain of attacks on their tankers and harassment by the Niger Delta militants. A marketer, who narrated his experience to BusinessDay said his company had lost several millions of naira worth of products to militants who either seized their tankers or extort ransoms.
He said he had vowed not to go to Warri or Port Harcourt to lift diesel to other parts of the country until it is safe for him to do so.
BusinessDay gathered that the price at which the product gets to the filling stations is about N143 per litre, while the retail price of the product is between N150 to N160 per litre.
Marketers also cite the bad state of the roads between Benin and Ore as a major factor contributing to the ugly situation, saying that most times, the trucks carrying products from Warri get involved in accidents.
The country has only three diesel depots located in Warri, Kaduna and Port Harcourt, while Lagos where most of the product is consumed has no such depot.