Oil marketers have projected that with a landing cost of N1,117 per litre for Premium Motor Spirit (PMS or petrol), the monthly subsidy for the commodity has surged to approximately N707 billion. This revelation comes amidst escalating concerns over the sustainability of subsidizing petrol prices in Nigeria.
The Major Energies Marketers Association of Nigeria (MEMAN) recently disclosed the significant disparity between the landing cost and the ex-depot price of petrol, highlighting a subsidy of about N532 per litre. This stark difference underscores the substantial financial burden on the government, with monthly subsidies potentially reaching N707 billion.
Despite assurances from the Nigerian National Petroleum Corporation (NNPC) that it no longer subsidizes petrol, stakeholders including IPMAN (Independent Petroleum Marketers Association of Nigeria) and MEMAN insist that the current market conditions necessitate continued government intervention to maintain stable prices.
The ongoing fuel crisis has further been compounded by regulatory challenges and the Dangote Petroleum Refinery’s imminent entry into petrol production, which may lead to exports rather than domestic supply due to supply chain constraints.
In response to mounting pressures, the House of Representatives has inaugurated an investigative committee to probe allegations of fuel price manipulation and the quality of imported petroleum products, reflecting growing legislative concern over the downstream petroleum sector.
Meanwhile, the Minister of State for Petroleum Resources, Heineken Lokpobiri, convened a high-level meeting with key industry stakeholders to address the challenges facing the Dangote refinery and explore solutions aimed at enhancing sector stability.
As Nigeria grapples with these complexities, the debate over petrol subsidies and the future of domestic fuel pricing remains critical amid economic uncertainties and global market dynamics affecting oil prices
