Sudden gas shortage in Nigeria has motorists lining up at pump

Global Business

People are lining up for gas in Nigera. Most filling stations have run out of supply and the few still selling have been jam-packed by motorists waiting to fill their tanks. The scarcity comes at a time when President Muhammadu Buhari is working to get OPEC leaders to stabilize the price of crude in the global oil market.

CCTV Africa’s Deji Badmus reports.

Sudden gas shortage in Nigeria has motorists lining up at pump

People are lining up for gas in Nigera. Most filling stations have run out of supply and the few still selling have been jam-packed by motorists waiting to fill their tanks. The scarcity comes at a time when President Muhammadu Buhari is working to get OPEC leaders to stabilize the price of crude in the global oil market. CCTV Africa's Deji Badmus reports. For the past three days, Nigerians have been battling a sudden scarcity of petrol, which appears to be getting worse every passing day. The irony of the situation is that it comes at a time when there is a supply glut of crude across the world, which has forced prices down for a sustained period. Even Nigeria is having issues selling the petroleum products that the country is producing. At the heart of the scarcity is foreign exchange. Importers say they have been finding it difficult to source foreign exchange from commercial banks and so they have not been able to import refined petrol. Nigeria now rations the sale of forex following the depletion of its reserves. The government has seen a significant drop in its forex earnings as a result of the fall in global crude prices. Energy expert Bala Zakka said one way to alleviate this perennial gas scarcity problem is developing domestic refining. "What is currently happening is our refusal to plan and understand that internal refining capacity is the way forward," Zakka said. Nigeria is Africa's largest oil producer but it currently imports over 70 percent of its refined petroleum products. Its local refineries have never worked to their optimal capacity even after several turnaround maintenance. The government says the latest scarcity will disappear in matter of days as more supply is brought in. President Buhari's recent meetings with the leaders of Saudi Arabia and Qatar to seek to stabilize oil prices is seen as a step in the right direction, but experts are warning it might still not be enough to shore up prices.

For the past three days, Nigerians have been battling a sudden scarcity of petrol, which appears to be getting worse every passing day.

The irony of the situation is that it comes at a time when there is a supply glut of crude across the world, which has forced prices down for a sustained period.

Even Nigeria is having issues selling the petroleum products that the country is producing.

At the heart of the scarcity is foreign exchange. Importers say they have been finding it difficult to source foreign exchange from commercial banks and so they have not been able to import refined petrol.

Nigeria now rations the sale of forex following the depletion of its reserves. The government has seen a significant drop in its forex earnings as a result of the fall in global crude prices.

Energy expert Bala Zakka said one way to alleviate this perennial gas scarcity problem is developing domestic refining.

“What is currently happening is our refusal to plan and understand that internal refining capacity is the way forward,” Zakka said.

Nigeria is Africa’s largest oil producer but it currently imports over 70 percent of its refined petroleum products. Its local refineries have never worked to their optimal capacity even after several turnaround maintenance.

The government says the latest scarcity will disappear in matter of days as more supply is brought in.

President Buhari’s recent meetings with the leaders of Saudi Arabia and Qatar to seek to stabilize oil prices is seen as a step in the right direction, but experts are warning it might still not be enough to shore up prices.