Energy Distribution in Nigeria: Conceptualizing Frameworks for the Supply of White Petroleum Products in the Downstream Sector

Abstract

For the fact that Nigeria's refineries are more related to death or not working in full capacity, Nigeria's import dependency is not limited to non-oil commodities. Traditionally, Nigeria export crude oil and import refined petroleum products; therefore, the challenges of availability, sufficiency, and distribution of such products are often attributed to the downstream as well as the poor state of the country's refineries. Knowing that there are many players in the sector which include firstly the major importers and marketers whose reward comes in the form of subsidy payment by the government, and then the marketers who thereafter trade with a long list of middlemen or retailers, the question of who is responsible for the improper arrangements of petroleum products still is very arguable. Regarding movement and distribution of petroleum products in Nigeria, transportation has become a physical hindrance. Because of this system, petroleum products can be circulated to various regions from their origins. Almost 80% of petroleum gets circulated through roads. It has been observed a steady increased in the number of heavy vehicles which are used as a carrier. Poor condition of roads, disturbance among police, military, state revenue agency, and customs checkpoints also create problems in logistics. This study focuses to find factors which are responsible in the supply of white petroleum in the downstream segment of the Nigerian oil and Gas sector. It concludes that unless urgent and long-lasting measures are taken by the government and private sector, the performance of the sector will continue to dwindle with attendant multiplier effect on the economy.