The Nigerian National Petroleum Company Limited and fuel marketers under the aegis of the Independent Petroleum Marketers Association of Nigeria, on Tuesday, clashed again over the removal of subsidy on petrol.
This came against the backdrop of the depreciation of the naira against the United States dollar at both the official Investors & Exporters Window and the parallel market.
On Tuesday, the local currency closed at 998/dollar at the official market, while it traded at 1,225/dollar at the black market.
On the back of the falling naira rate, economists and oil marketers said PMS subsidy was increasing in recent times, but the NNPC quickly countered these positions and declared that it was recovering its full cost on the importation of Premium Motor Spirit, popularly called petrol, countering the positions of The Chief Executive Officer, Financial Derivatives Company, Bismarck Rewane, had during a live television programme on ChannelsTV on Sunday, explained that fuel subsidy was not removed but reduced.
Similarly, oil marketers told our correspondent on Tuesday that subsidy on petrol was increasing considering the crash of the naira against the United States dollar and the cost of crude oil, stressing that PMS should sell for N1,200/litre in a free market.
Petrol, which is solely imported into Nigeria by the NNPCL, currently sells for between N617/litre to N660/litre, depending on the location of purchase in Nigeria.
Also speaking on the matter, the Chief Executive Officer, Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, said there was partial subsidy on petrol, but noted that the commodity was subsidised by the government for political, social and economic reasons.
Full cost recovery
But when contacted, the Chief Corporate Communications Officer, NNPCL, Olufemi Soneye, described the positions of economists and marketers as assumptions, and insisted that the Federal Government had stopped subsidy on petrol.
President Bola Tinubu had during his inaugural speech on May 29, 2023, declared that subsidy on petrol was gone, a declaration that was effectively implemented the next day by NNPCL.
Before Tinubu’s declaration, the pump price of petrol was below N190/litre, but it jumped to over N500/litre after the President’s statement, and moved up again to over N600/litre a few weeks later.
Asked to state if the NNPCL, being Nigeria’s sole importer of petrol, subsidising the commodity as posited by dealers and experts, the oil firm’s CCCO replied, “We prioritise our time on substantive matters rather than responding to assumptions.
“At NNPC Ltd, we prioritise national development through energy security and sustainable growth. We reiterate that the Nigerian government does not pay subsidy on fuel; we recover full costs from our imported products.
As a global energy company, our focus remains on fostering a vibrant and energy-secure Nigeria.”