Dangote And That ‘Monopoly’ Blackmail

For a significant length of time now, the formerly ubiquitous and hazardous sale of petroleum products through unregulated channels has disappeared in major cities and towns across Nigeria. It is easy to take this milestone for granted without recalling what the situation was before the entry of the Dangote Refinery into the petroleum industry.

It is still a great wonder that not even the global price surge in commodities as a result of the brazen and nonsensical war being waged on Iran by Israel and its stooge in Washington has been enough to revive the black market for petrol and petroleum products on Nigerian streets.

Likewise, the Christmas and New Year festivities passed last December without the associated rituals of long queues, high prices, and acute scarcity of petroleum products. This was never the case when importation and supply depended entirely on the national petroleum company, the NNPC.

Dangote has obliterated the gallon trade and shady distribution channels not by any caveat or force of law, but quite simply by ensuring product availability. The street market for petroleum has disappeared. Reports of explosions caused by diluting petrol with less inflammable fuels have significantly reduced. So have vehicle damages and engine troubles usually associated with low-quality or adulterated fuel.

I still imagine what might have been if Nigeria had to depend on NNPC’s import regime to provide for local demand at this time – a period when most countries have declared an emergency in energy production, holding back products to take care of local demand as well as contending with severe production and supply disruptions in the Arabian Gulf.

The Strait of Hormuz is blocked. Supply from Middle Eastern countries which control between 30-32 percent of global oil trade have been negatively impacted since February 28. Some countries in Southeast Asia have even proclaimed national emergencies and are contending with social unrest due to shortages.

In the circumstance, Nigeria would have been thrown into an economic catastrophe with NNPC’s well-documented inefficiencies and corruption – adding to the woes of a population already besieged with low purchasing power and very high cost of living.

NNPC was legendary for improvising excuses for the scarcity of petroleum products. In the present state of affairs, there would have been a surplus of justifications for the unimaginable scarcity and its attendant social disequilibrium. The excuses would not only have been self-evident, but valid – war, rumours of war, and all major exporters declaring force majeure.

Yet, despite all of the above, there is no petroleum scarcity in Nigeria, no long queues, no street boys loitering on the highways with hoses, improvised funnels and gallons of petrol – endangering themselves, motorists and the public. Vehicle owners simply drive up to the pump, and prices are still reasonably within the global average.

It’s a miracle – a strategic national achievement recorded by a private citizen against the background of sabotage, profiteering, and other economic crimes orchestrated by state-appointed officials in a state-owned corporation bothering on sheer wickedness. Dangote has saved us all that trouble.

It is against this background that one finds allusions to monopoly and other such assertions being made against Dangote not merely shallow and bereft of logic, but even offensive. We have had NNPC’s monopoly in the same industry for over three decades – billions of dollars pumped into the drain pipes of vested interests for maintenance of oil-producing infrastructure; more billions pumped to subsidise products supplied, under-supplied or not supplied at all; and adulterated, foul-smelling petrol at the pumps at higher prices.

For decades we saw it, experienced it, witnessed it, and lived with it. We hoped for significant change every time there were reports about turnaround maintenance at the refineries. Then we got nationally scammed when NNPC officials fabulously blabbed about resumption of production at the plants – the same way the Ministry of Aviation scammed Nigerians with a rented aircraft that was purported to be for the national airline.

Then entered Dangote!

I would gladly trade that state-sponsored, dysfunctional monopoly of NNPC for Dangote’s order, civility, and rapid adjustment to global trends and market dynamics. No drivers are sleeping in petrol stations to buy fuel, there are not too many fights at bus stops over fare adjustments, but there’s a global crisis that would have amplified and multiplied these problems beyond the government’s capacity to cope and tested the citizens’ struggle to survive beyond elastic limits.

It is based on this and with such a deep sense of passion that I call on all other monopolists who received licences along with Dangote to build refineries to hasten up. The market – both domestic and export is large enough to accommodate the competition. We need more such monopolies. The best way to challenge Dangote is for other entrepreneurs to get into the ring and deal.

As for the state-owned monopoly now in a coma, we have seen through its poorly veiled attempt to run down a private investor who has done what they failed to do. One can only say: “Beware of what happened to NITEL (MTEL) when it failed to shape up to new realities”.

Very many thanks to Africa’s leading industrialist!

–Julius Ogar writes from Utako, Abuja