Petroleum Marketers Warn Of Oil Market Structure Disruption
Hoscom Bulk Petroleum Retailers has expressed concern over a perceived asymmetrical market structure in Nigeria’s oil sector. Specifically, they warned that NNPCL’s recent actions may be creating a monopoly.
This concern follows statements attributed to Bayo Ojulari, Group CEO of NNPCL, during a courtesy visit by PENGASSAN leadership. According to reports, Ojulari said he found that operating the Port Harcourt Refinery was causing financial losses, and therefore, he decided to halt operations in search of a “sustainable solution.”
State-Owned Refineries Act as Price Checks
Hoscom emphasized that nation-owned refineries serve as a crucial check against private refineries. However, by shutting down the Port Harcourt Refinery, NNPCL effectively removes this mechanism, potentially allowing private refineries to dominate the market.
In a statement jointly signed by High Chief Sunny Nkpe, Dr. Joseph Obele, Promise Oluka Ochen, Emmanuel Inimgba, Hon. Dickson Oballey, Pastor Tekena Ikpaki, and Chief Zephaniah Sample, Hoscom criticized NNPCL for relying on its equity stake in Dangote Refinery, a private entity, while keeping its own refineries offline.
“NNPCL should be ashamed to proudly state their reliance on a private refinery while shutting down their own,” the group stressed.
Concerns Over Dangote Refinery Stake
Furthermore, Hoscom highlighted that NNPCL’s stake in Dangote Refinery currently stands at 7.2%, far below the originally agreed 20% due to non-payment of the balance. Meanwhile, billions of dollars were spent on rehabilitating the Port Harcourt Refinery, which now sits idle.
The group also supports PENGASSAN’s call to revamp Nigeria’s four state-owned refineries. In addition, they urged President Bola Ahmed Tinubu to take decisive action to make these refineries functional, thereby boosting GDP and creating jobs.
Alleged Favoritism Sparks Criticism
Hoscom asserts that Ojulari’s shutdown of the refinery was intentional. Contrary to his claims of “routine maintenance” or “sustainability assessment,” the group argues that the move deliberately benefits private rivals.
“This move allowed private refineries to gain an edge, leading to superior performance and price exploitation against Nigerians,” the statement reads.
As a result, Hoscom claims that Ojulari’s decisions prioritize private refinery interests over public refineries, even after billions of dollars were invested in the Port Harcourt revamp. They argue that operations could have continued while sustainability assessments were underway, ensuring continued public benefit.
