An increase in the pump price of Premium Motor Spirit (PMS) should be expected as soon as the Petroleum Equalisation Fund (PEF) concludes plans to increase petroleum transportation pricing template from N3.89k litre to N9.11k, Daily Sun investigation has revealed.
However, the Executive Secretary of PEF, Mr Ahmed Bobboi said the pricing template was delayed owing to ongoing negotiations between the Labour Union and the Government.
Under the National Transportation code (NTA) supervised by PEF, an organ of the Ministry of Information, collections, and claims settlement under NTA are mainly collected from two kinds of product transactions, Bridge products and local transactions. NTA on Bridge products is deducted at source from marketers that are within Zone 1 and 2(Claim zone), while those within zone 3to 9(Contribution zone), are reimbursed for both the NTA and Bridging elements of their transactions.
A source in the industry who wanted to be anonymous owing to the political leaning of PEF and fear of victimization said if PEF increases NTA, the price of fuel will increase. The source who lamented that was a scam said that those that are meant to be contributing to PEF fund in Zone 1 and 2 were not doing so, while those that are filing claims for zones 3 to 9 were not actually landing products at those locations.
Data from the Nigerian National Petroleum Corporation (NNPC) shows that the North-West region consumed more volume of petrol at 985,974,850 litres in Q1 2020 compared to the South-West region with 599,821, 058 litres within the same period. The source goes further, that the idea of PEF was meant to stabilize petroleum product prices across the country so that prices are not at variance from one location to the other.
‘’But the irony is that prices of petrol across the country have never been the same. The price you buy a litre of petrol in Enugu is not the same as Yobe. And this is what PEF meant to address. You will find that those that were meant to transport petrol to Maiduguri, actually sell same in Lagos but make transport claim for same under a Maiduguri depot.
‘’ They forge documents and get the delivery papers signed to show that the products were actually delivered at Maiduguri. So over time, those that are supposed to be contributing to the fund in zone 1 and 2 were not fully complying and this created funding challenges for PEF that those they were meant to be reimbursed could not get it owing to funding constraints’’.
The source also added that those in zones 1 and 2 were the ones funding the fuel cost for those in very far locations. He added that this practice should be discouraged because it is fraudulent and should not have a place if the sector has been deregulated.
‘’Technically, this is another form of subsidy. Nobody subsidises the cost of cows, goats, beans, pepper and onions that are brought from the Northern part of the country to Lagos. The price you get these items in the Noth is different from that of Lagos.
To make matters worse, a larger chunk of the petroleum products that PEF is subsidizing , eventually, finds its way to other neighbouring countries which included Niger, Chad, among others.
Source:https//www.sunnewsonline.com/petrol-price-to –increase –as-pef-hikes-transportations margin/
