The Nigerian economy was literally brought to its knees this week, just days to the inauguration of Muhammadu Buhari as Nigeria’s President, due to an industrial crisis in the oil and gas sector.
On Tuesday, May 26, for instance, chaos reigned at Nigerian airports where most flights were cancelled. Foreign airlines flew to other African countries to refuel. Most passengers were stranded because some flights were delayed.
At petrol filling stations, cars and jerry cans formed long queues often obstructing the free flow of traffic for stretches of more than two kilometers (a mile).
In the midst of the chaos black marketers had a field day, selling petrol (even though adulterated) at exorbitant prices to motorists that were already embattled. Attendants turned away people carrying jerry cans to buy kerosene for cooking. There was none.
Things got to a head when even banks started closing at lunchtime as at Monday while telecom companies warned that they too would be forced to shut down service countrywide for lack of diesel to power their operations. Some radio stations and Internet Service Providers, ISPs had earlier suffered similar fates as they had to shut down operations due to non availability of diesel.
Welcome to Nigeria – Africa’s biggest oil producer – which generates more than two million barrels of crude oil per day but imports the refined product because its refineries are not properly maintained.
Besides that, a woeful national grid that offers only a few hours of electricity on a good day failed to generate any electricity recently because of shortages of gas to power its thermal stations. A combination of these factors predictably left businesses and homes that can afford it dependent almost totally dependent on diesel-powered generators. The country frequently suffers fuel shortages, but the disruption suffered last week was unprecedented.
The Independent Petroleum Marketers Association of Nigeria (IPMAN), said the finance minister agreed on Monday, May 25, to pay them $800 million. It said companies started distributing products on Tuesday and unpaid tanker drivers also called off their strike action.
Ngozi Okonjo-Iweala, finance minister, had accused the petroleum marketers of holding Nigeria to ransom over the disputed debt, bemoaning “so much fraud allegations and scams in this business of oil marketing.”
Prior to this strike action, Nigeria’s government hit by a dip in oil prices that provides 80 per cent of its revenue and a massive slump in the value of the Naira, has been borrowing to pay salaries.
Some analysts say the latest crisis was precipitated by the fact that petroleum product importers were worried that the new government led by Mohammadu Buhari would not pay them for products earlier supplied. This believe is hinged on the fact that leaders of the new government have never hidden their position that the payment of subsidies on fuel importation in Nigeria is a fraud.
On the other hand, The All Progressives Congress, APC, has accused the President Goodluck Jonathan’s administration of sabotage to ensure it inherits “a nation in crisis.”

Maureen Nzeogu
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