In a recent development, the federal government has firmly denied claims that it is subsidizing the landing cost of refined petroleum products. This statement comes amid reports indicating a significant rise in landing costs, which have now exceeded N1,000 per liter.
During a media briefing in Abuja on Thursday, July 25, Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, addressed the concerns. He emphasized that no subsidy payments have been made since President Bola Tinubu’s announcement on May 29, 2023, which marked the end of the fuel subsidy regime.
“The President made it clear on May 29 that the subsidy is gone. We do not have any provisions in the budget for subsidy payments. No payments are being made, whether in the budget or otherwise, by the federal government of Nigeria or the federation for subsidy,” Edun stated.
Recent reports from the Major Oil Marketers Association of Nigeria (MOMAN) revealed that the landing cost of Premium Motor Spirit (PMS), commonly known as petrol, was N1,117 per liter as of July 16, 2024. This figure is based on the current exchange rate of N1,500 to one US dollar.
Despite these figures, the government maintains that it is not covering the shortfall. Instead, the Nigerian National Petroleum Company Limited (NNPCL) is managing the impact of exchange rate fluctuations as part of its duty to ensure the availability of petrol in the domestic market. Edun emphasized that this does not equate to a subsidy.
Meanwhile, petrol pump prices have been adjusted upwards across various filling stations. According to the National Bureau of Statistics, the average pump price of petrol has risen to N750 per liter, up from N545.83 per liter in 2023. Benue State recorded the highest petrol price at N864.55 per liter, followed by Jigawa and Rivers States at N847 per liter and N810 per liter, respectively.
The surge in petrol prices has contributed to mounting public dissatisfaction, prompting discussions of a nationwide protest scheduled for August 1, 2024. Citizens are expressing frustration over the economic pressures they face due to the rising cost of living.
In a related development, Aliko Dangote confirmed that his refinery has commenced petrol production. Speaking with journalists, Dangote revealed that petrol sales to marketers are set to begin in August 2024. The new supply from Dangote’s refinery is anticipated to help reduce petrol prices, which currently exceed N700 per liter.
As the situation develops, the federal government remains steadfast in its position, denying any reintroduction of subsidies and stressing the importance of market-driven solutions to address the nation’s energy needs.
