Following the announcement by President Bola Tinubu during his inauguration that the Federal Government will no longer pay subsidy on Premium Motor Spirit,the Nigerian National Petroleum Company Ltd has effected an upward adjustment in the price of petrol across the country.
The approval is contained in a schedule detailing
the new prices that would be charged by the NNPC retail outlets across the
country.
The NNPC in playing it’s energy security role
is the sole supplier of petrol in Nigeria currently and it is now expected that
other marketers will follow the NNPC prices and adjust their own pump price
with effect from today.
According to the price template, the price of
petrol has now been adjusted upward from between N189 to N194 to N537 per litre
in Abuja and other North-Central States such as Nasarawa, Plateau, Kwara, Kogi,
Benue and Niger.
For Lagos and other South West States such as
Oyo, Ogun, Ekiti, Ondo and Osun, the price of PMS was raised from between N184
and N189 per litre to between N488 and N500 per litre.
In the South East where states such as Abia,
Imo, Anambra, Enugu and Ebonyi, the price was increase from between N184 and
N189 per litre to N515 to N520.
Similarly, in the North -West, the price of
PMS was raised from N194 per litre to N540 while for the North-East, it moved
from N199 to N550 per litre.
The NNPC Ltd had shortly after the
announcement by Tinubu saidthe decision to remove the subsidy on Premium Motor
Spirit (PMS) by the President is a welcome development.
The Group Chief Executive Officer (GCEO) of
the NNPC, Mr. Mele Kyari during a press briefing shortly after the
pronouncement by President Tinubu said the subsidy burden which has been placed
on the NNPC Limited is affecting the
company’s cashflow and threatening its sustainability plans due to the federal
government’s inability to refund the subsidy claims.
He added that NNPC as a limited liability
company cannot continue to bear the burden of subsidy on behalf of the
federation if it must deliver dividends to its shareholders and be profitable.
He said, “We welcome the decision of the
president to announce the removal of subsidy on PMS and this has been the major
challenge for NNPC operations.
“We have been funding subsidy from the cash
flow of the NNPC since government is unable to defray the cost of subsidy for
the federation. We believe that this will free resources for the NNPC to
continue to do the great work that this company is doing for our country and it
allows us to continue to function as a commercial entity.”
Kyari assured that the company has over 30
days of PMS storage and supply and appealed to Nigerians not to indulge in
panic buying.
He stated further that the company is in
discussion with the Nigeria Midstream and Downstream Petroleum Regulatory
Authority (NMDPRA) to develop a framework of the implementation of the removal
of the PMS subsidy as announced by the President.
He further added that the company as the
supplier of last resort as mandated by the Petroleum Industry Act (PIA) will
continue to ensure availability of PMS and other petroleum products.
Tinubu had in his inaugural speech at the
Eagles Square abolished fuel subsidy in Nigeria, saying it is no longer
sustainable.
Newly adjusted price at NNPC Mega Station,
Lagos Bus Stop, Port Harcourt today 31st May, 2023.
He had said, “On fuel subsidy, the budget I
met before I assumed office and what I heard is that there is no provision for
subsidy. Fuel subsidy is gone.”
The Federal Government had in the last few
months been taking steps to stop the payment of fuel subsidy.
In the 2023 budget, the federal government
had made provisions of N3.36trn for fuel subsidy payment to cover the first six
months of this year.
This is in line with the 18-month extension
announced in early 2022 by the government.
The immediate past administration of former
President Muhammadu Buhari had set up a Subsidy Removal Committee which
comprises the Ministry of Finance, Budget and National Planning, Ministry of
Petroleum Resources, Nigerian National Petroleum Company (NNPC) Limited, the
downstream and upstream regulators, Central Bank of Nigeria (CBN) and the Chief
Economic Adviser to the President.
The 2023 Fiscal Framework and Appropriation
Act as well as the Petroleum Industry Act (PIA) have made the provision that
government should exit fuel subsidy by June 2023.
Kyari had during the inauguration of Dangote
Refinery last week stated that the lingering challenge of Petroleum Motor
Spirit subsidies is becoming unbearable as the burden is clearly getting out of
the capacity of the state to bear.
He gave the monthly fuel subsidy burden at
about N400bn monthly, adding that something needs to be done urgently to stop
the spending.
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