Oil marketers are urging President Bola Tinubu to consider a gradual relaxation of the subsidy removal on Premium Motor Spirit (petrol). The recommendation stems from the challenges faced by importers in accessing United States dollars, leading to adverse effects on businesses. This advice comes in light of President Tinubu’s recent assurance against fuel price hikes and subsidy reversal.
However, petroleum product marketers are drawing attention to Kenya’s experience, where the government reinstated petrol subsidies to alleviate the severe impact of their removal on citizens. Mohammed Shuaibu, the Secretary of the Independent Petroleum Marketers Association of Nigeria, Abuja-Suleja, highlighted the need for government responsiveness, emphasizing that Nigeria’s oil-producing status and refinery issues should be taken into account.
Shuaibu emphasized that the removal of subsidy had already manifested in the rise of petrol costs due to foreign exchange fluctuations. Despite the Nigerian National Petroleum Company Limited’s recent announcement of no immediate price increase, the mounting exchange rate could eventually push prices beyond the current N617 per liter.
While addressing the challenges posed by subsidy removal, Chinedu Ukadike, the National Public Relations Officer of the Independent Petroleum Marketers Association of Nigeria, called for government intervention. He pointed out the broader impact on the economy, including increased transportation costs and business shutdowns.
The Nigeria Extractive Industries Transparency Initiative (NEITI) also weighed in, advising the government to incentivize private investments in refinery infrastructure. NEITI recommended a deliberate policy to attract investors and improve Nigeria’s refining capabilities. The organization emphasized the need for both Nigerians and foreign investors to play a role in enhancing the country’s petroleum sector.
In response to these concerns, Ajuri Ngelale, the Special Adviser to the President on Media and Publicity, affirmed that Nigeria’s petrol prices remain the most affordable in the West African region. He noted a reduction in daily fuel consumption following subsidy removal, indicating that the market was adjusting to deregulation.
Ngelale reiterated the President’s stance that there would be no immediate pump price increase. He also emphasized the President’s call for stakeholders to exercise patience and refrain from premature actions or threats.
As the government navigates the challenges surrounding subsidy removal and its effects on the economy, the voices of oil marketers, regulatory bodies like NEITI, and official statements underscore the complexity of the situation and the need for a balanced approach.