Nigeria oil products supply problems set to ease
Talks between the upper house of the National Assembly and fuel marketers ended in an agreement yesterday, which led to truck drivers returning to work.
Oil marketing firms were demanding that the government pay around \$1bn in outstanding subsidies on refined products already delivered and because of the recent weakness in the value of the Nigerian naira currency.
Domestic airlines were forced to reduce their services because of limited jet fuel supplies, while some international carriers had to refuel in neighbouring states, including Ghana. Motorists endured long queues to secure gasoline, while banks, telecommunications firms and schools were also impacted by the lack of refined products.
The severe disruptions comes ahead of the inauguration of president-elect Muhammadu Bahari on 29 May.
Nigeria is heavily reliant on imports of gasoline, diesel and jet fuel. State-owned NNPC operates the country's Port Harcourt, Warri and Kaduna oil refineries, which have a combined capacity of 445,000 b/d but are operating below 20pc of that capacity because of poor maintenance and investment.
Despite its chronic fuel shortages, Africa's largest oil producer has a struggled to sell its crude oil in recent months, partly because of the once-key US market no longer buying Nigerian crude. This has led to a backlog of unsold cargoes in recent months that has forced sellers to lower their offers and undermined a vital source of government revenue.
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