Report: NNPC owes $3bn backlog on petrol payments to fuel traders

The Nigerian National Petroleum Company (NNPC) Limited owes around $3 billion to fuel traders for imported petrol.

According to Reuters on Monday, three sources confirmed the development.

The debt is coming amid the removal of petrol subsidy in the country.

On May 29, 2023, President Bola Tinubu announced the removal of subsidy on petrol — a development that immediately led to a spike in the price of the product and spiralling inflation across board. 

The president had, however, said the removal of the petrol subsidy was a challenging but necessary decision to secure the country’s energy future.

According to the publication, NNPC, Nigeria’s major petrol importer, still struggles with payment for imported petrol due to the incessant depreciation of the naira and rising global fuel prices.

“They are paying, but it’s slow,” one of the sources told Reuters.

Five sources, the publication said, confirmed NNPC was taking more than 130 days to make the payments instead of within 90 days.

According to Femi Sonoye, NNPC spokesperson, the company was “not aware of any such debt nor any financial issues of such magnitude”.

“Our focus remains on sustaining sufficiency in the supply of petroleum products in Nigeria,” Soneye said.

Also, the sources said NNPC’s suppliers, including international traders like Vitol, Mercuria and Gunvor as well as Nigeria-based trading houses, are still supplying fuel.

On February 29, the federal government said petrol importation into the country had dropped by 50 percent since the removal of the subsidy.

This was disclosed by Mohammed Idris, minister of information and national orientation, who said the reduction in importation was due to the removal of subsidy.