On Tuesday, oil marketers urged President Bola Tinubu to gradually ease the removal of subsidy on Premium Motor Spirit (petrol) due to the challenges faced by importers in accessing US dollars, which has negatively impacted businesses. However, President Tinubu ruled out both a fuel price hike and the reversal of fuel subsidies.
Petroleum product marketers advised the President to learn from Kenya’s experience, where the return of petrol subsidy was necessary to mitigate the adverse effects of its removal on the populace. Mohammed Shuaibu, the Secretary of the Independent Petroleum Marketers Association of Nigeria (Abuja-Suleja), cited Kenya’s decision to reintroduce the subsidy as a precedent. He emphasized the importance of the government considering the well-being of its citizens.
Shuaibu highlighted that Nigeria’s status as an oil-producing nation with dormant refineries and dependency on imports was problematic. He urged the government to recognize the role of forex in determining petroleum product costs and emphasized that marketers were reluctant to continue importing products. He called for the urgent relaxation of the subsidy removal to alleviate the current situation.
Shuaibu argued that despite the Nigerian National Petroleum Corporation Limited’s statement on Tuesday that there would be no increase in petrol price, the rising exchange rate could lead to higher costs, surpassing the current N617/liter.
Chinedu Ukadike, the National Public Relations Officer of the Independent Petroleum Marketers Association of Nigeria, stressed that the abrupt removal of subsidies without appropriate palliatives caused severe hardship. He emphasized the need for intervention to address the increasing costs and hardships faced by the citizens.
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The Nigeria Extractive Industries Transparency Initiative (NEITI) recommended that the government formulate policies to attract investors to improve and fix Nigeria’s refineries. NEITI advised the Federal Government to incentivize private investments in refineries through tax holidays and institutional support.
Clement Isong, the Executive Secretary of the Major Oil Marketers Association of Nigeria, echoed the sentiment that government intervention was necessary if the dollar continued to rise. Isong stated that if fuel prices escalated due to the increasing exchange rate, the government should step in, as President Tinubu had mentioned.
Amid the ongoing surge in the cost of living attributed to the removal of the petrol subsidy, the Presidential media spokesperson, Ajuri Ngelale, affirmed that Nigeria currently enjoys the most affordable petrol price in West Africa. Ngelale clarified that daily fuel consumption had decreased following the subsidy removal and reiterated the President’s assurance of no pump price increase.
Ajuri Ngelale further noted that the petroleum market had been deregulated, and President Tinubu approved the dissemination of a chart comparing PMS prices in West African countries, demonstrating that Nigeria’s prices were among the most reasonable in the region.