A controversial levy of N1 per litre on Premium Motor Spirit (PMS) imposed by unions across Nigeria has once again ignited tensions within the petroleum sector. Marketers and importers are raising alarm over the reintroduction of this fee, which is being charged for every litre loaded at depots nationwide, adding to the already significant operational costs.
According to industry sources, the union levy was previously halted following protests from marketers but has now been reintroduced without prior notice. “For every single litre of PMS, marketers are required to pay an additional N1, alongside the union’s standard loading fees, which range from N60,000 to N80,000, depending on the depot,” said a source familiar with the situation.
This extra charge means that for a 60,000-litre tanker, marketers are paying an additional N60,000 in union levies. When multiplied by the millions of litres of PMS imported daily, this results in significant sums collected by the unions. Marketers have questioned the legality of these fees and speculated whether the federal government is aware of or benefits from the substantial revenue generated.
“This system has been in place for a long time and raises questions about transparency,” one marketer remarked. “It’s unclear where the money goes—whether it’s being collected by the government or just the union.”
Even union members have expressed dissatisfaction. A union worker revealed that the original fee outlined in their constitution was only 20 kobo per litre and was intended to benefit lower-level union workers at the depots. However, it has now increased to N1 per litre, with accusations that the funds primarily benefit higher-ranking officials while the lower cadre is left without their due share.
“Even some union workers want the N1 levy stopped,” the source added. “It’s not only the marketers who are unhappy. The entire system is in question.”
Despite widespread dissatisfaction, there is little protection for those voicing concerns, as the industry is often described as opaque and difficult to challenge. The situation highlights systemic issues within the petroleum sector, where transparency and accountability remain major challenges.
Oil marketers argue that this extortion is one of the bottlenecks affecting fuel supply and distribution, with these collections amounting to trillions of naira.
Another aggrieved union worker commented, “There’s a lot of corruption in NUPENG, and several members are unhappy. From the 20 kobo charge in the constitution, they’ve hiked it to N1 per litre. The total sum of these collections goes to the top. The N1 charge is both illegal and unconstitutional!”
A depot owner around Coconut axis stated that it costs between N60,000 and N70,000 to load PMS at depots, including the statutory N35,000 levy imposed by NUPENG and its associates on trucks loading products. Other expenses, such as PTD expenses and an additional N20,000 per truck taken by NUPENG, further add to the costs.
“Recently, we noticed that for a 45,000-litre truck, an extra N45,000 is paid to load products. Our drivers return, complaining that they are now paying almost double what they used to pay for loading.”
In the past, depot marketers staged a mild protest, but NUPENG, the Petroleum Tanker Drivers (PTD), and the Independent Petroleum Marketers Association of Nigeria (IPMAN) have retained these charges. These extortions, according to industry experts, create a chaotic business environment. The charges do not include additional payments made to security agencies, among others. IPMAN, a branch of NUPENG, relies on the union to enforce some of its levies. As a result, increasing loading levies on marketers directly impacts consumers by drying up their pockets.
Regulatory bodies like the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) are being urged to intervene and ensure transparency.
An industry expert noted, “No one knows where this new N1 charge came from,” adding that these extraneous costs are negatively affecting overall distribution and profit margins.
