The quantity of foreign exchange used for the importation of petroleum products into Nigeria fell to $1.04bn last year from $1.32bn in 2020, according to data obtained from the Central Bank of Nigeria.

As the country’s refineries continue to sit idle, fuel imports remain a major user of foreign exchange, even as many businesses still lament the inability to access forex at the official rate.

The nation’s forex reserves have been on a downward trend in recent months, falling to a low of $39.77bn on February 15, 2022 from $40.54bn at the end of last year.

The CBN’s data on sectoral utilisation for transactions valid for forex revealed that $45.76m was utilised in January 2021 for fuel imports; $64.67m in February, and $142.31m in March.

Forex for fuel import transactions fell to $77.96m in April and $85.64m in May but rose to $86.42m in June.

The country utilised $83.73m in July and $103.70m in August for petroleum products importation.

The apex bank said $66.66m was used for fuel imports in September, $74.01m in October, $82.65m in November and $131.25m in December.

Last month, the Monetary Policy Committee noted the need to encourage the take-off of private refineries across the country to provide alternative competitive local supply source and reduce the need for government intervention to manage fuel prices for domestic consumption.

It said, “Members noted the dwindling proceeds from oil sale, despite rising crude oil prices. They further noted the need to address the persistent reduction in remittance of oil revenue to the Consolidated Revenue Fund and urged the NNPC to urgently address this anomaly.

“The improved foreign exchange supply will thus support the bank’s demand management strategy in the foreign exchange market and consolidate macroeconomic performance, especially those that promote export, reduce dependence on import and reduce foreign exchange demand pressure.”

The Nigerian National Petroleum Corporation is the major supplier of petroleum products in the country and has been the sole importer of petrol for more than four years as the market realities forced private marketers to stop the importation of the product.

“The corporation has continued to diligently monitor the daily stock of PMS to achieve smooth distribution of petroleum products and zero fuel queue across the nation,” the NNPC said in its latest monthly report.

Buoyed by the rally in global oil prices, the cost of Premium Motor Spirit, also known as petrol, imported into Nigeria from January to September last year surged by 55.56 per cent to N2.52tn from the N1.62tn spent in the same period of 2020, according to the National Bureau of Statistics.

The NBS data also showed that petrol topped the list of products imported into the country in Q3, accounting for 12.52 per cent of the total amount spent on imported products, up from 11.26 per cent in the previous quarter.

The PRESS had reported on December 23 that the NNPC spent a total of N1.16tn on petrol subsidy from January to November, citing data from the corporation.

The subsidy, which the NNPC prefers to call ‘value shortfall’ or ‘under-recovery’, resurfaced in January this year as the government left the pump price of petrol unchanged at N162-N165 per litre despite the increase in oil prices.

The Federal Government had in March 2020 removed petrol subsidy after reducing the pump price of the product to N125 per litre from N145 following the crash in oil prices.