Nigerian fuel marketers Thursday warned that supply and distribution of oil products across Nigeria may be grounded if the government fails to pay them Naira 800 billion ($2.2 billion) in subsidy arrears owed on imports over the past three years, Platts reports.

Nigeria usually imports around 1 million mt/month of petrol, with the major marketers (Oando, Conoil, Forte Oil, MRS, Mobil and Total) accounting for around 40%. The petrol is bought on the wholesale market on a dollar-denominated basis and then sold into the retail market at a capped price of Naira 145/liter ($0.45/l). The marketers in a joint statement said the bulk of the debts were accumulated bank charges on loans obtained to place orders for petrol cargoes, which accrued on imports done between 2014 and first quarter of 2017.

“As a result of the unpaid interest and foreign exchange differentials, we are becoming insolvent and financially handicapped to continue operating profitably,” the marketers said. “The outstanding matured Letters of Credit are currently over $1.2 billion. Because many Nigerian banks were involved in raising this fund, the entire Nigerian banking system is at risk on account of these transactions.”