Date: 2017-02-16

By Ahmed 'Lateef

To put an end to perennial fuel crisis, the Federal Government must muster the courage to completely deregulate the downstream sub-sector of oil, the Department of Petroleum Resources (DPR) has said.

The Operations Controller of the DPR in Kwara State, Mr Salvation Philip, who made the observation while on a monitoring of filling stations in some parts of Ilorin metropolis, said the only option to address the lingering crisis in the oil sector was to encourage total deregulation.

He stated that the sector has been largely monopolized, thus making fuel crisis in the country a recurring decimal.

Philip explained that the downstream sector, which is currently grappling with shortage of supply for domestic consumption, will be highly competitive when more people are allowed to partake in the business.

He said the competition in the downstream will also stimulate effectiveness and efficiency with resultant effect of high productivity.

The DPR boss also urged the government to create conducive atmosphere that is economically viable through enactment of appropriate laws.

While admitting that the foreign exchange crisis has dealt a severe blow on the oil business, Philip said the government has continued to cushion the effect of the crisis with importation of large volume of fuel otherwise known as premium motor spirit (PMS).

"The permanent solution to perennial crisis of fuel is effective management. We need to create a conducive atmosphere that is economically viable through appropriate laws.

"We must also emphasize that the way out is complete deregulation. It will ensure competition in the industry, and where people are competing, it will lead to effectiveness and efficiency, and it will result in high productivity in the sector.

"In the long run, there will be more investment and sustainable availability of the product. It will lead to expansion in the investment with associated benefits like employment generation. That is how we can optimize the downstream. The environment is not conducive now because of scarcity of forex (foreign exchange). And in spite of this problem, government is doing most of fuel importation", DPR Operation Controller said.