The Nigerian government’s cancellation of the naira-for-crude initiative has led to the beginnings of a fuel crisis, with retailers hoarding fuel to guarantee they have enough to sell at a higher rate, according to Business Insider Africa.

Retailers started to hold on to fuel following a statement from Nigeria’s 650,000 barrels per day (bpd) Dangote Refinery saying it would begin to sell petrol in dollars. The Independent Petroleum Marketers Association of Nigeria (IPMAN) has since responded, warning that the practice could lead to “heavy losses”.

Comments from IPMAN were made by the organisation’s national publicity secretary, Chinedu Ukadike, who told the Punch that while fuel stations were attempting to get fuel, depot owners were making money.

“Some depot owners are already increasing the price. But we are also asking our marketers not to panic-buy. Because when the Dangote refinery comes back and reverses the price, it will be a huge loss for these marketers. Depot owners are using this opportunity to profiteer. This is not good for the economy,” he said.

“Some marketers are also stockpiling PMS in a bid to increase the price based on the suspension of naira sales by the Dangote refinery. They speculate that the price will go higher and they will make more money from the fuel they are buying now”.

Ukadike said that the issue would be resolved, and that projections could be wrong – which would lead to significant losses for hoarders.

“Dangote may crash the price and most of them with high volumes of PMS [petrol] will run into problems,” he is quoted by the Punch as saying. Ukadike also highlighted that the suspension of the naira-for-crude initiative was not yet fully decided, and that discussions were still ongoing.

Regarding the issue, he noted that the government and Dangote Refinery were “resolving the matter,” and concluded that the two entities were reviewing the deal to continue the sale of crude to the plant. “We are waiting for the official statement,” he said.