The failure of the Central Bank of Nigeria to make foreign exchange available despite promises has further worsened the scarcity of aviation fuel, leading to multiple problems for airline operators, OKECHUKWU NNODIM writes
The chronic scarcity of aviation fuel, popularly known as Jet A1, which has dragged on for several months, has grown worse in the past three weeks mainly as a result of the inability of the Central Bank of Nigeria to provide foreign exchange to importers despite many promises to do so.
According to oil traders and operators in the airline business, the CBN, in its bid to avert the scarcity of petroleum products during the Yuletide, asked banks to submit bids for a “special currency auction” on December 5, 2016, which targeted fuel importers in order to meet the demand for imports.
They noted that prior to the request, the apex bank had suspended the provision of the United States dollars needed by the oil dealers for the importation of refined products.
Traders had explained that the CBN sent a message to the banks to submit backlog of dollar demands from fuel importers around 3pm on December 5 for the special intervention.
It was, however, learnt that the Federal Ministry of Petroleum Resources and the Nigerian National Petroleum Corporation had to swiftly intervene in order to avert the cancellation of flights on a larger scale by domestic airlines as a result of the scarcity of aviation fuel.
The Executive Secretary, Major Oil Marketers Association of Nigeria, an umbrella body of some petroleum products’ importers, Mr. Obafemi Olawore, told our correspondent that forex accessibility was still an issue affecting the importation of products.
When reminded of the special intervention by the CBN and asked if the marketers had started accessing forex based on the apex bank’s promise, he replied, “We don’t have it.”
“Let the CBN know that we don’t have it. What we are using to carry out importation of products is the intervention put in place by the Petroleum ministry and, of course, the NNPC,” Olawore added.
Domestic airlines had revealed last week that the oil marketers were not importing Jet A1 due to the lack of forex and that this had prompted the cancellation of many flights.
Nigeria’s biggest commercial airline, Arik Air, had alerted passengers to the worsening aviation fuel supply situation, leading to flights delays and cancellations at airports across the country.
“Arik Air has been operating over 100 daily flights and, therefore, experiences a larger impact of this scarcity compared to other airlines. The airline requires a daily supply of approximately 500,000 litres for its operations, but it has been getting between 180,000 and 200,000 over the past 10 days, which has severely impacted the scheduled flight operations,” the airline’s spokesman, Adebanji Ola, said in a statement.
“But the emphasis now is on PMS for it is what most of the generality of the populace use. As for aviation fuel, it is deregulated. So, if you have the forex, you can import; and the government has also through the NNPC opened the window where marketers can source for forex by working with big upstream companies.”