Fuel Marketers Confirm Reintroduction Of ‘Subsidy’

Nigeria operated quasi-deregulation after former President Muhammadu Buhari on August 16, 2021, assented the Petroleum Industry Bill (PIB) into law, which the Senate had passed on July 15, 2021, and the House of Representatives also passed it on July 16, and so ended a long wait since the early 2000s. However, Buhari’s government continued to pay subsidy on fuel.

But President Bola Tinubu, in his augural speech on May 29, 2023 pronounced the removal of fuel subsidy and ushered in total deregulation of the downstream sector which led to increase in fuel pump prices, a high inflation rate and the attendant hardship on Nigerian.

IPMAN Public Relations Officer, Ukadike Chinedu, in an interview with New Telegraph yesterday, said Tinubu’s statement through his special adviser on media and publicity, Ajuri Ngelale, that price of petroleum products would not rise, was an indication of the reintroduction of subsidy or quasi- deregulation.

Chinedu said: “Based on the report from the spokes-person of Mr President, some of the issues concerning the price of fuel.

Mr President has intervened. By making such a statement that the prices of petroleum products will not increase, the price of fuel will be static, it means that it is what could be called quasi-deregulation whereby government intervenes where it is necessary. “I think Mr. President has done that direction. Since the dollar is not going to shore or going to shore and the price of petroleum products remains, it means that there is a subsidy, either that the federal govenrment is subsidising the little rate between the dollar rate and what Nigerians are purchasing from the ordinary market.

“There is quasi-deregulation. There is quasi subsidy because the dollar is still soaring and has not come down and Mr President said there will be no increase in pump price, so who is subsiding the difference? There is a serious differential, If there is a serious differential, and the pump price is not rising in line with the demand of the dollar and the rate of the dollar at the parallel market, there is a serious problem.

Who is subsiding it? “For now, in line with Mr,. President’s directive, NNPCL has not moved the current ex-depot price. Its current ex-depot price continues to be N587.70. For now, the NNPCL is still the sole importer of petroleum products in the country. It is just a few selected importation that was done by Emadeb and some other private companies. But now, the competition has not set in.

Most of them who want to import are still scouting for dollars and it is very scare for the importers who have been issued licenses. “Those who were given licenses to import can not import because, by the time you finish selling with the local currency, you go and buy another one, the dollar will be two times what they used to buy the former stock so there is no profit.”