FROM THE ARCHIVES: CBN
Report on Fuel Shortage & Prices in Nigeria (1998)
Central
Bank of
Nigeria
Special Economic Review Series
Vol. 1. No. 1: May 1998
THE
PERSISTENT SHORTAGES OF PETROLEUM
PRODUCTS IN NIGERIA: A RE-APPRAISAL 0F
CAUSES AND POSSIBLE REMEDIES
Government, in
an attempt to satisfy the ever expanding demand for petroleum
products in the country,
established four refineries, with a combined refining capacity
of 445,000 million barrels
of crude oil per day. At full capacity, the refineries will
produce sufficient fuels for
the domestic economy and a substantial surplus for export.
However, provisions were
made for importation of petroleum products to complement
local production during
emergencies. In spite of these efforts, the phenomenon of
petroleum products shortages
which began in 1975 has persisted over the years. Owing
mainly to its telling effect
on the economy, the issue of recurrent shortages has been of
great concern among various
interest groups, including private sector investors,
manufacturers, households
and policy-makers. For example, in 1990, it necessitated the
setting up of investigative
studies and a judicial commission to unravel the underlining
factors in fuel shortages in
the country. Also in 1995, a committee was constituted to
review the activities of the
NNPC and its subsidiaries so as to find lasting solutions to
the problem.
2. Summary of
Fuel Shortages Study
by the
Research Department. 1997
Against the
backdrop of protracted petroleum product shortages lasting for about
five consecutive months in
the first half of 1997, the Research Department undertook
a diagnostic study on the
causes of shortages of refined petroleum products in Nigeria
during the year. The study
covered the period 1994 – 1997 and the major findings included
the following:
(a) Shortages in the
Midst of Excess Supply:
With the
exception of 1994, when prolonged oil workers
