A fuel pump (stock photo).
…Current realities support N200/litre — Iledare
…No govt has ‘raped Nigeria’ like Buhari’s—TUC
…Fuel price hike shocking — ActionAid
…FG currently not financially able to pay subsidy — Sylva
By Michael Eboh, Boluwaji Obahopo, Rotimi Ojomoyela
Petrol stations across the country, yesterday, adjusted their pumps to reflect the hike in the ex-depot price of the Premium Motor Spirit, PMS, by the Petroleum Products Marketing Company, PPMC, with some of the stations raising the price to as high as N161 per litre.
In Abuja, it was also observed that all the stations were opened and were seen dispensing the commodity to motorists without any hitch.
Specifically, at Oando petrol station in Dutse, along the Abuja-Kaduna expressway, only a few cars were seen inside, while the station was dispensing the product to motorists at N161 per litre; while Eterna Petrol station and Gegu petrol station, few blocks apart, were selling at N159 per litre and N158.1 per litre respectively.
In addition, the NNPC retail station at Katampe was selling at N160 per litre; Total retail outlet at Tipper Garage, N148.8 per litre, while Bozimo petrol station at Karu is selling at N160 per litre.
In Lagos, the situation was same as petrol stations adjusted their pumps to sell fuel for as much as N161:50.
Speaking on the price hike, Uche Uwaleke, Professor of Finance and Capital Markets of Nasarawa State University, Keffi and former Commissioner of Finance of Imo State, however, warned that the hike would heighten inflationary pressure and worsen the living standards of Nigerians.
He said: “This is clearly a downside risk to inflation. In the coming months, I expect inflationary pressure to heighten as crude oil price recovery in the International market necessitates a hike in domestic pump price of imported fuel. This situation will be compounded by naira devaluation.
“The alternative is petrol subsidy, which the government cannot afford now as this may not have been provided for in the 2020 budget. Again, expecting a government already saddled with huge debt to borrow to subsidize price of petrol does not make economic sense.
‘’With all the economic headwinds, there is no question about a spike in cost of living in the coming months.”
He, however, stated that the solution remained passage of the Petroleum Industry Bill, PIB, into law to pave way for investors in the oil refining sector.
Current realities support N200/litre — Iledare
Also speaking, Professor Wumi Iledare, Ghana National Petroleum Corporation’s Chair of Petroleum Economics at Institute of Oil and Gas Studies, IOGS, in the University of Cape Coast, Ghana, said with the current economic reality, the price of PMS should be selling at N200 per litre.
He said: “The reality on ground is not pretty at all with respect to what the price ought to be. At the current official exchange rate of $1 to N385, N200 is about right because of the level of demand driven by population and quality of life. Keep in mind that any attempt to invoke subsidising petroleum has unintended consequences.
“We all need to adjust and perhaps pump more money to the economy. Invoke patriotism, if the government has to, with carrot and stick to those owing government money.
“If Ghana is surviving, Nigeria’s exchange rates call for at least N200 per litre in Nigeria. In Ghana, a litre is about N325-N350 equivalent. Like Nigeria, PMS consumed are imported. Lessons can be learned from Ghana.
No govt has ‘raped Nigeria’ like Buhari’s —TUC
Also reacting, Trade Union Congress, TUC, in a statement by the president, Quadri Olaleye, and Secretary-General, Musa-Lawal Ozigi, said no government has “raped” the country like the administration of President Muhammadu Buhari.
They described the increment of petrol price and electricity tariff as “wicked,” adding that it was coming at a time people were losing jobs because of the effects of COVID-19.
The statement read: “They have developed a thick skin that our pleas and cries no longer mean anything to them. No government has raped this country like the present one; ironically it has enjoyed our understanding the most
“They beat us and when we cry, they send security operatives after us or force us to pay a fine of N5 million for ‘hate speech.’ Our patience has run out.
“It is difficult to cope in this circumstance. Do we still wonder why unemployment and insecurity have increased? This is disgustingly shameful.
Fuel price hike shocking — ActionAid
Also reacting, yesterday, ActionAid Nigeria condemned the new hike in fuel prices, saying the development would leave more Nigerians poorer.
Country Director, ActionAid, Ene Obi, said in a statement that with the effects of COVID-19 putting Nigerians out of job, increase in the fuel price becomes an additional burden on average Nigerians.
He said: “We are not out of COVID-19. A lot of citizens are losing their jobs, people are getting poorer, more responsibility with school closure, young people roaming the streets unemployed and fuel hike at this time is shocking.
“Governance is about easing the pain and burden of the common man, but it seems the Nigerian government is not in touch with the reality on ground.
“We are dealing with too many increases at the same time and this is introducing so much inflation into our lives. Governance is about the people.
“Instead of dealing with insecurity, we are taking actions that will further heighten insecurity because as inflation goes up and more people are plunged into poverty, there will be more conflict in our society.”
FG currently not financially able to pay subsidy— Sylva
Meanwhile, Minister of State for Petroleum Resources, Timipre Sylva, yesterday, disclosed that the Federal Government was not currently in a position, financially, to pay subsidy, as the COVID-19 pandemic had impacted negatively on the country’s finances.
Addressing newsmen in Abuja, Sylva also disclosed that since the introduction of the deregulation policy in March 2020, the country had saved about N1 trillion.
He further stated that the Federal Government had concluded plans to merge the Petroleum Products Pricing Regulatory Agency, PPPRA, and the Petroleum Equalisation Fund, PEF, into one agency called ‘The Authority’.
Sylva noted that the deregulation of the downstream petroleum sector and the removal of subsidy was not a political decision, but had become inevitable, especially with the effect of the COVID-19 pandemic, the low crude oil prices and curtailing of Nigeria’s production output by OPEC, which had constrained government’s revenue.
Sylva also added that PPPRA and PEF would still be relevant to serve as a regulator on the industry, noting that without PPPRA and PEF, it would be difficult to deal with profiteers.
However, he disclosed that the PPPRA and PEF would not exist as they currently are, stating that with the passage of the Petroleum Industry Bill, PIB, the two organisations would be merged into one and called ‘The Authority,’ to help monitor the downstream sector.