High cost: Low sales at petrol stations as citizens abandon vehicles

Petrol consumption has drastically reduced in Nigeria with filling stations recording sharp drop in patronage as reports from across the country indicate. This is largely connected to the high cost of premium motor spirit (PMS), also known as petrol, with a litre selling as much as N1,200 in some parts of the country. The outright […]

Petrol consumption has drastically reduced in Nigeria with filling stations recording sharp drop in patronage as reports from across the country indicate.

This is largely connected to the high cost of premium motor spirit (PMS), also known as petrol, with a litre selling as much as N1,200 in some parts of the country.

The outright removal of fuel subsidy from PMS by President Bola Ahmed Tinubu’s administration on May 29, 2023, has triggered an increase in pump price, rising from N198 first to N580, and ultinately to between N998 and N1,200.

This represents an increase of about 600 per cent from N198, when it was sold pre-May 29, 2023.

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With the high cost of the product, it has become virtually unaffordable to many Nigerians with citizens parking their vehicles at home, and filling stations recording low sales, as confirmed by stakeholders in interviews with our reporters.

There are conflicting reports on the daily petroleum consumption. While some reports said it has dropped by over 50 per cent, another report suggested it has dropped by 92 per cent from what it was in 2023.

But reports from across the states indicated a drastic drop with some filling stations complaining of very low patronage while many state that they are at the brink of shutdown.

Kano

Rising fuel cost has forced many car owners in Kano to park their vehicles and use alternative means of transportation.

While some use commercial tricycles to commute, others resort to trekking to reach their destinations.

A staff of Aminu Kano Teaching Hospital, Tijjani Muhammad, told Daily Trust that he has parked his car and is now using public transport to go to work.

The staff said he stopped conveying his children to school and asked them to use commercial tricycles. They too, he said, sometimes trek to school.

“I cannot afford to buy fuel at its current price. For me, driving my car is now a luxury because fuel price is prohibitive, and also same with food stuff. So, I have to choose which one is necessary.

“I decided to park my car and now trek to my workplace, which is even a daily exercise after all”, he said.

Aminu Dan Malam, a businessman at Kaloma area of Kano, said he has two cars but the high cost of petrol has forced him to park one.

“I now use motorcycle to go round for my business. And considering that we have to be taking the children to school, my wife is using the smaller car for that purpose.

“We hope the federal government will fast track the CNG initiative which they said will bring down the cost of transportation.

“What we are witnessing now in the country is not really good. The fact that petrol stations are recording low sales and people are parking their cars means low productivity. It is really not good because it also means consumption is not increasing. No economy can grow without production,” he said.

Abubakar Sadiq, a manager at an Aliko Oil petrol station, said sales have dropped to 10,000 litres a day compared to 15,000 litres daily in the past two months.

Sadiq, however, explained that though sales in terms of volume have dropped, sales in terms of cash collection remain unchanged because of the difference between the current price and the previous one.

“Car owners no longer fill their tanks like before because you need at least N55,000 now to have your tank filled. Many people just buy N20,000 or N25,000 worth of fuel and then plan their movements,” the station manager told one of our correspondents.

Unlike Danzaria, Hamza Adamu, an accountant in a private firm, said he has parked his car now because his monthly pay is not enough to buy fuel at its current price.

Kaduna

Alhaji Tajudeen Ajigbade, a resident of Kaduna said majority of people have now left their cars at home due to the present harsh realities.

“I know someone who has a car but rides a motorcycle instead because he has parked the car due to the cost of fuel. Let the government look at the situation with a human face because it is affecting many people,” he said.

He added that he does not drive around “carelessly” with his vehicle.

A manager at a filling station in Mando, Kaduna, Alhaji Balarabe Salis, said business is no longer what it used to be because their daily sales has dropped by almost 50 per cent.

According to him, prior to the fuel price increase, his filling station usually sells 5,000 litres of PMS daily, but now it finds it difficult to sell 2,000 litres in a day.

Borno

As the fuel price continues to rise, parents in Maiduguri said they grapple with the surging cost of transporting their children to school.

Most parents interviewed said they now close from work between 1pm to 2pm to pick their children home, while others parked their vehicles at the school to wait for the closing hours.

Abdulkareem Lawan, a parent residing in Bulumkutu bypass, explained how he made some adjustments to cope with the situation.

“As a father, I am groaning within myself because the situation has turned ugly. I spend N70, 000 on fuel monthly just to take my four children to school. So, I was forced to cut down on my movements.

“What I now do is to park my vehicle close to my children’s school and hops Keke Napep to my work place, and return after the school hours. It is more economical,” he said.

Gombe

In Gombe, managers of private fuel stations have also complained about low sales as a result of poor patronage by motorists amid the incessant hikes in petrol price.

Some station managers who spoke with Daily Trust, said that they are recording low sales currently, compared to a few months ago when the price was below N1,000 per litre.

Malam Shamsudeen, who is the manager of Dan Marna Filling Station, located along Biu Road,  said two months ago they used to sell between 18,000 and 20,000 litres daily, which is about two trucks of 45,000 litres every week. “But it is no longer the same,” he said.

Also, a staff of AYM Shafa Filling Station, located along Dukku Road, said before the recent increase, they sold a truck of 45,000 litres within three days.

“However, it is now taking us almost two weeks before we can sell the same 45,000 litres truck. This is when the neighbouring filling station adjacent to us is not selling. If they have fuel, it takes much longer to sell that quantity,” he said.

A public servant, Najib Sani said he only uses his car twice a month since the removal of the fuel subsidy over a year ago.

Benue

In Benue State, many petrol stations have closed down business while others continued to record low sales occasioned by the steady rise of fuel price.

Our correspondent reports that the situation has forced many car owners to also abandon their vehicles.

A manager of a private petrol station, Iorlumum Tyokyer, said they are recording low sales not just because people have parked their cars at home but that purchasing the product from major marketers also drives up the cost.

He said: “This situation is hurting us financially, and we are operating at a loss. We are deeply concerned about the fuel situation in the country. The government promised relief once the fuel subsidy was removed, but that hasn’t been our experience.

“The poor are struggling more, with transport and food prices skyrocketing, making survival challenging. I urge the federal government to take immediate action to lower fuel prices from what it is currently”, he said.

Tyokyer worried that only two months ago, fuel price skyrocketed to N950, which was beyond the reach of many Nigerians, but now selling at least N1,250 in private stations, causing them to continue recording lower sales.

Kwara

In Kwara State, a filling station owner at Offa Garage, who did not want his name in print, said sales have dropped compared to before the latest fuel hike.

“We used to sell 11,000 litres daily before the latest increment by NNPCL. But now, we hardly sell 8,000 litres a day, which is about a 25 per cent drop.

“And this is because fuel is a perfectly elastic product that has no alternative for now. If there is an alternative that is much available, it will reduce to 50 per cent”, he said.

On his part, the manager of a station at Oko-Olowo said the issue depends on the location of the filling station.

A lecturer at one of the polytechnics in Kwara State, who simply identified himself as Mr. AbdulSalam, told Daily Trust that he has since parked his car because of the hike.

Lagos

In Lagos, Daily Trust findings showed that some filling stations have stopped dispensing while those selling are recording low turnover.

A manager at one of the NNPCL outlets in Ikeja, expressed concern over the level of patronage, saying it has declined since the hike in the price of fuel.

He added that many customers rarely fill up their tanks while those that filled their tanks rarely return to refill until the end of the month.

“It is a shame that that Nigeria which has a large deposit of oil is facing energy crisis. It is a reflection of the kind of people we are,” he said.

The manager said that they organised training for fuel attendants on how to manage customers’ temperaments, stating that many customers are prone to aggression due to the cost of living.

Edo

In Edo State too, petrol stations are grappling with low patronage following the increase in the pump price of petrol.

In the state, most of the fuel stations sell a litre for N1,250, N1,200, N1,195, while the cheapest, which is the NNPC, sells a N1,100.

Pump attendants and managers of some of the filling stations, who spoke on the development, said the number of litres sold daily has drastically reduced.

One of the station managers, Cyril Irafidon, who works with Conoil Filling Station in Benin City, noted that many people have parked their cars while others have converted theirs to CNG.

On his part, a manager at one of the Total filling stations, Collins Eghe, said the business is no longer what it used to be as vehicle patronage has really gone down.

Anambra

The latest fuel price hike is affecting both dealers and buyers in Awka, the Anambra State capital.

Mr. Stanley Onyejikwe, manager at the Silluch filling station in Amaenyi, Awka South Local Government Area, stated that the fuel price hike has significantly impacted buyers’ purchasing power.

Concerns over declining productivity

While Nigerians are facing the reality of a deregulated petrol regime, there are concerns over its effect on the economy and the productivity of Nigerians.

Dr. Garuba Dauda, an oil and gas expert and development policy analyst, said the drop in sales will inevitably affect the economic performance because energy, which is one of the biggest drivers of any economy must be accessible and affordable.

“To realise a functional economy, its availability, accessibility and affordability must be guaranteed. At the moment, the purchasing power of citizens is very low due to its unaffordability. Amidst present economic hardship precipitated by the hike in the prices of petroleum products, it is only expected that only survival needs would pre-occupy the attention of many happy people. Hence, driving cars is not on the physiological needs of many people”, he said.

Another energy expert, Ma’aruf  Isma’il, advised the federal, state and local governments to fast track the energy transition programme.

“The implication of not having affordable fuel is much. A situation where civil servants cannot go to work because they cannot afford the transportation cost, and business people are also cutting their movements is a recipe for chaos. Productivity will be grounded.

“My advice to the governments at all levels is that they should subsidise the CNG conversion process. They should also provide the infrastructure. We cannot afford the snail speed at which some of these things are being handled. The economy will be grounded if nothing is done,” he said.

But an industry player, Tunji Oyebanji in a chat with one of our correspondents, assured that the situation would normalise. “People are adjusting, smuggling is reducing. Things will take time to settle down,” he said.