Dollars for fuel given priority

NIGERIA’S central bank had asked banks to submit bids for a “special currency auction” targeting fuel importers to meet demand for matured letters of credit, traders said yesterday. Traders said the central bank told banks to submit backlog dollar demand from fuel importers by yesterday afternoon for a special intervention. Nigeria uses 45 million litres of petrol a day, which requires the market to provide some $18 million (R248m) a day. Importers cover about 30 percent of this, with the state oil firm covering the rest, which is a big strain on the market for dollars. Nigeria has four refineries but years of neglect mean it needs to import petrol. Fuel shortages often occur in Nigeria during festive periods. Traders said the government was channelling dollars to fuel retailers to avoid shortages. – Reuters UK