THE EFFECT OF FUEL CRISES IN NIGERIAN ECONOMY

(A CASE STUDY OF ENUGU STATE)

ABSTRACT

The time has come for us to adopt an authentic measure and reorganize our method of approach to fuel distribution. It is high  time we (Nigerians) set up and put both out human and material resources together in order to curbe the problem that face people during fuel crisis.

This project is divided into three chapters. The first and second chapter focuses of the background of the study that is how fuel scarcity originated and the various problems people are going through due to the fuel crisis.

The second chapter deals with the various economic benefits of the fuel and implications of fuel scarcity. The last chapter concerns with, what government should do in to curb or reduce scarcity of fuel Nigerian.

We strongly hope that, this project will contribute tremendously in reducing the problems of people if government will make use of the recommendations in chapter 3.

TABLE OF CONTENTS

Chapter One

        Introduction

        Background Of Study

        Statement Of Problem

        Objective of Study

        Research Hypothesis

        Scope/limitation Of Study

        Definition of Terms

References

Chapter Two
2.0         Literature Review

2.1       Economic Benefits of Fuel

2.2       Implications of the Scarcity On

Nigerian Economics

2.3       School Of Though Relevant To

The Problems Of Study

2.4      Different Method Of Study The Problem

2.5       Summary

            References

Chapter Three

3.1         Data Presentation

3.2         Analysis Of Data

3.3         Recommendation

3.4         Conclusion

3.5         Bibliography

CHAPTER ONE

INTRODUCTION

BACKGROUND OF STUDY

The fuel scarcity that has befalls the nation in recent years to be worse at the beginning of this year. It caused a lot of pain, anguish and dislocation of economic and Sunday activities. There hardy any individual, industries, institution and organization in Nigeria that is not severely effected.

It is widely believed in government cycle that the persistent of fuel crisis is largely caused by the bottlenecks and other associated problems government agencies, besides, there are problems of manpower shortage, inadequate finding, lack of materials officials limitation and safety of personnel which officials explained have hundred department of responsibilities in distribution of petroleum product which increased the execution of its product which increased the crisis in Nigeria.

 

Despite the effort of OPR, some encourage and sale of adulterated fuel. The crisis situation worsened when one of the filling stations had fuel to sell and the black market rate will increase from and the black market rate will increase from N250 to N400 depending on the level of adulteration with kerosene.

 

The problem of products adulteration fuel diversion, smuggling, and hording and under delivery at retail outlets have been rampant in spites of the existence of the department which is changed with the overall co-ordination, monitoring and general supervision of fuel product.

The inability of NNPC and PPMC in distribution of fuel increased the crisis.

According to the former managing director of PPMC Alhaji Haruna Abubakari there has not been an appreciable improvement of fuel distribution. He enumerated factors that militate against the distribution fuel. They are-:

i.              Diversions of fuel through conspiracy of some independents market and tanker drivers and in some case the task forces.

ii.            Smuggling both through roads and sea.

iii.           Poor monitoring of trucks conveying products by the OPR and the task force.

The fuel scarcity is believed to have worsened in certain occasions by hoarding.

A one time petroleum resources minister Chief Dan Etete conducted a random check at 7 filling stations and observes that station.

 

Despite all the efforts of the ministry and parastatals, the NNPC and PPMC have almost found it impossible to eliminate the act8ivities of saboteurs in the country.

According to the minister between January and March 1998 Nigeria has had a daily local consumption of 8, 509 millions liters of fuel supported with 6853 million liters of important fuel thereby bringing the total product to 15.392 millions liters. Dan Etete announced that smugglers and sabotours in the country contribute in no small amount to fuel, scarcity.

The NNPC official attempts to arrest persistence fuel crisis, culminating in the first ever “operation crush” nationwide exercise the problem has refuse to go.

The special adviser to late Abacha, Alhaji Wada blamed the situation on the activities of economics saboteur, who divert about so percent of the fuel supply meant for daily consumption to the black market. The chief of natural staff rear admiral mike Okihai Alchigbe said that as long as poor pricing of petroleum product in Nigeria are high pricing in neighboring countries continued, the smuggling of oil outside the country would remain a lucrative business. The shortage of fuel is a sign of bad management said by the former governor of central bank Mr Ola Vincent.

1.2         STATEMENT OF THE PROBLEM

The fuel crisis in Enugu state has continued to effect social and economic activities with transport fares and prices of commodities sky- rocketing daily. Traders complained had the prices of goods and other essential commodities increased due to fuel crisis.

The fuel crisis has made local drug manufactures to produce drugs at a very high cost. The problem also affected industries where many flights were cancelled as a result of shortage of a aviation fuel.

The crisis stunts Nigeria ECOWAS export Nigeria chronic fuel crisis is stunting the country’s goods exported to other countries. Fuel crisis has made it difficult for grains as well as spare parts and other goods manufactured in Nigeria to be transported in a large quantities as demand by neighboring countries.

These problems also affected civil servants, business men students and lecturers in a very big way. They arrived to their work place late, even some students are unable to attend lectures due to their inability to afford transport fares. It also affected industries that use fuel to power their generating that such as the national Electrical Authority (NEPA)  

Reports has it had people about one hundred and fifty consumers of fuel were killed in February 1999 resulting from adulterated fuel, smuggler are involved in the adulteration of fuel in order to get money with oyt considering the life of consumers.

 

Soldiers and other security agents deployed to petrol station to maintain peace and order contribute to the problems of fuel arise in that they went there to do their wish. They are not the game of bribing. They collect money from drivers before the allow then to enter the filling station. These increased transport fare.

1.3       OBJECTIVE OF STUDY

At the end of this research work, it is hoped that it will be useful and profitable to all and sundry especially students lacks lectures, government, industries, organization, civil servants etc and researcher as well this work will help to adopt a serve and most drastic measure in distribution and  management of fuel in the country.

It will also help to find out the fact that contributed to fuel crisis in Enugu aid how government can curb the crisis.

1.4       RESEARCHER HYPOTHESIS

In view of the foregoing circumstance some pertinent question were asked by the researchers in order to determine the impact of fuel crisis in Enugu state and such question include:-

How do fuel crisis affects consumers and transporters.

What are the effects of security agent during the distribution of fuel?

What are the effect of fuel crisis to industries and organizations?

Were the fuels dealers are pump attendant happy during the crisis.

How did fuel crisis stunt Nigeria ECOWAS Export?

What are the resultant effect of a crisis to lecturers and students?

1.5       SCOPE OF THE STUDY

The study ifs designed to cover the concept and structure of fuel crisis. It states the reactions of fuel dealers and pump attendants during the distribution of fuel and how they will be allowed to enter the filling station. This study states how government industries, organization etc. adapt to the system during the fuel crisis.

1.6       DEFINITION OF TERMS

SKY-   ROCKETING:           Arbitrary increases in prices etc.

CULMINATING:                    Have the specific final conclusion or result.

SUBSTANDARD:                Below the usual or required standard, for instance substandard goods of products

ADULTERATION:                Make poorer in quality by adding another substance of example adulterated fuel with kerosene added.

DISLOCATION:                    Put out of its proper position of things for instance the strike will cause some dislocation of raw traffic.

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