By Elizabeth Chukwuma
For much of last week and, there have been rumours making the rounds that the Nigerian National Petroleum Corporation, NNPC, now baptized Nigerian Petroleum Corporation Limited, with the signing into Law of the Petroleum Industry Bill, PIB, passed by the National Assembly in 2019, under the close watch of Mele Kolo Kyari, and the Leadership of the Independent Petroleum Marketers Association of Nigeria, IPMAN, at the Federal level have piled up President Muhammadu Buhari to increase price of premium Motor Spirit, PMS, popular, Petrol price per litre, across the country. This may have created artificial scarcity and increase in transport fares in Lagos.
Akin Akirinade, Lagos Zonal Chairman , IPMAN, had made Nigerians to believe that the Petrol scarcity currently being experinced in Lagos, the nation’s Commercial nerve centre, was because members took a decision ‘to go on strike’’ which may believe was to adjust the fuel pump at their various filling stations. But Akiranade had said that it was informed by the operating environment across the country which has become ‘’hostile to their businesses’’.
He noted that’’ to load a litre of petrol from the any of the Lagos depots, costs N162 per litre, stressing that the increase in petrol situation in Lagos and its environs has nothing to do with ‘’the removal of subsidy or deregulation of the nation’s Petroleum sector’’.
Akiriade, the Lagos IPMAN Chairman, had listed ‘’the high cost of diesel in running their fuel stations, and the increased cost of freight as the major factors responsible’’ for the agitation for increase in the price of fuel. He may have spoken the mind of the Chairman of IPMAN at the Federal Level when he said that ‘’it was no longer feasible to sell a litre of petrol at any Nigerian filling station at ‘’the government recommended price of N165.00’’, noting that ‘’the landing cost of the product at the Lagos’s sea ports alone was between N170.00 and N178.00 per litre’’.
Given his calculations, he noted that the costs of transportation is between N6.0 and N8.00, depending on the distance within the Lagos Metropolis and more than the amount outside the city of Lagos, noting that with the difference the marketer is already spending N170.00 per litre, without adding the charges at the depot and the running cost of the product at their filling stations.
Perhaps to ensure that the mrketers sell within the FG recommended price of N165 per litre, NNPC, was said to have threatened to impose sanctions on the depots that have continued to increase the ex-depot price as approved. Even when the Corporation had threatened to deal decisively with any marketer who tries to take advantage of the situation in the country to increase prices of a litre of petrol at their filling stations but that was how far it could go.
The IPMAN officials were said to have made it clear to Kyari, NNPC, Managing Director and Temipre Silver, who had signified his intention for the 2023 Presidential election on the ticket of the APC, withdrew his ministerial position as minister of state, Petroleum Resources but later rescinded his decision that ‘’members can no longer sell petrol at N165 per litre, insisting that that ‘’no marketer can sell below N180 per litre because of the situation in the country’’.
IPMAN members may have been encouraged seek for an increase in the price of PMS, because NNPC, had in 2221, hinted that a litre of petrol may sell between N320.00 and N340.00 which was turned down by the Federal Executive Council, FEC.
NNPC has given the impression that the Nigerians consume over 100 million litres of petrol per daily across the country. NNPC, and spends N250 billion monthly to import fuel into the country. Ahmad Lawan, Senate President, who had contested for the APC, 2023 Presidential ticket but lost to Siwaju Bola Tinubu, a former governor of Lagos state had said that they are expecting something around N120 billion per month from NNPC to import petrol into the country monthly. He had lamented that despite the huge spent by NNPC to import Petrol which is sold to the IPMAN members to sell to motorists at subsidised rate, it is still remitting zero amount into the Federation Account on a monthly basis.
Hajia Zainab Ahmed, minister of Finance, Budget and National Planning, may have created the impression that the huge amount being spent on fuel subsidy is limiting the ability of the Federal government to service it’s over 40 trillion debt burden. The minister had aid that that NNPC would spend close to N3 trillion to subsidise the price of Petrol in the current price of N165.00 per litre in the 2022 Fiscal year.
Recall that in 2021, fiscal year, Hajia Ahmed , during one of their meetings in 2021, had said that between January and September, the government spent N864.07, on fuel imports , noting that it will take N 3 trillion based on the N250 trillion spent on monthly imports in 12 months to sustain the importation.
She had said that the government had made provision for N2.557 trillion to be able ‘’to meet subsidy requirement which is averaging about N270 billion per month in the 2022, fiscal year. It was not surprising why the Katsina state born Nigerian President had said that the ‘’government has taken a decision ‘’to keep paying subsidyies on fuel’’.
The Nigerian President had said that that the government has taken the decision to continue subsidizing fuel imports because ‘’the effects of removing fuel subsidies would be too harsh on the Nigerian people’’. He may have sent a signal to Nigerians to prepare their mind for the fuel subsidy removal eventually as ‘’it has set in motion plans to do so after further consultations with stakeholders and as events unfolds ‘’ late this year’’.
He may have gladdened the heart of Nigerians when he disclosed of plans of ‘’boosting internal production for refined products to help in the present situation. According to him, the local production capacity is due to step up remarkably this year and next, as Dagote refinery, BUA Group refinery, Walthersmith refinery and the modular refineries come on board’’.
Chukwuyere Anamekwe, acting Accountant General of the Federation, may have Nigerians recently when he said that ‘’the huge level of borrowing to buoy the budget shortfall and payment of salaries and wages is worrisome’’. He asserted that the country’s external debt situation had worsened in the first quarter of 2022 when the debt stock rose by 2.04 trillion to n41.60 trillion.
