No fresh palliatives for Nigerians over fuel price hike, says Minister

*Though painful, deregulation is a necessary policy direction ─Timipre Sylva, Minister of State for Petroleum

Isola Moses | ConsumerConnect

As consumers of petroleum products lament amid the growing criticisms over the current increase in petrol pump price from initial N148 to N151.56k, the Federal Government says it is not contemplating any further palliative in this regard.

Recall that the PPMC, the petroleum products marketing and distribution arm of the Nigerian National Petroleum Corporation (NNPC) Monday, August 31 increased the ex-depot price of petrol from N113.70 to N147.67 per litre.

Although the Petroleum Products Pricing Regulatory Agency (PPPRA), which is responsible for the regulation of the prices of petroleum products in the country is yet to make an official pronouncement on what the new price of petrol will be for the month, products marketers already have since adjusted their pump prices, in some instances, to about N160 per litre, according to report.

However, despite the groundswell of criticisms that greeted the latest petrol price increase, Timipre Sylva, Honourable Minister of State for Petroleum, said Thursday,  in Abuja, FCT, that there is nothing the government can do to intervene in the new petrol price.

Sylva stated that the development is a direct fall out of the deregulation policy announced in the petroleum sector in March 2020.

The Minister said: “There is no going back on the deregulation policy in the downstream sector of the petroleum industry.

“It is a necessary economic policy. Successive administrations had desired to achieve deregulation without success.

“Some lacked the political will, while for others the timing was not appropriate.

“But, there is a direct correlation of the price of the refined products to the crude oil price, as it is refined from crude oil.

“Therefore, when the crude oil price goes up, the price of the refined products and other derivatives go up, and vice versa.”

Subsequently, Organised Labour, interest groups, and the populace have vowed to mobilise Nigerians to oppose the hike.

They have described the timing as wrong in regards to the negative impact of ravaging COVID-19 pandemic on the  overall wellbeing consumers.

The Minister said the recent price increase was an inevitable policy direction. According yo him, at this time of COVID-19 pandemic, crude oil prices came crashing to the negative zone, with crude oil price dropping to below $10 per barrel.

“Subsidy benefited the rich against the poor. The country cannot afford the payment of subsidy.

“Deregulation meant government withdrew from the importation of petroleum products and allowed market forces to determine prices of petroleum products.

“To allow government to play its traditional role of protecting the consumers against excessive profiteering by the marketers,” declared Sylva.

He stressed that with crude oil price currently at about $45 per barrel at the international oil market, achieving that price level from less than $10 per barrel last April necessitated reducing Nigeria’s output in compliance with the Organisation of Petroleum Exporting Countries (OPEC) resolution to curtail output.

OPEC meant to stabilise the market and boost prices of crude oil at the international market, he said.

He disclosed that since then,  Nigeria has cut its daily production from over 2 million barrels per day to about 1.412 million barrels per day, almost halving the country revenue earnings.

“Deregulation is a necessary policy direction. I agree it would come with a few pains initially. “But I can assure you that when we all overcome it, we will be happy that we took the decision,” said he.

The Minister added that “in terms of palliatives, we have had a lot before in this country which did not take us anywhere.

“There is no government that has introduced as many palliatives as the current government, namely the N-Power scheme, Trader Moni, Schools feeding programme, etc., rollout scheduled for the end of this month.

“The solution to the current problem should be a little more sustainable, by providing cheaper and cleaner alternative fuels in terms of LPG and CNG, which has started a pilot scheme in converting Keke NAPEP in Port Harcourt.”

Kindly Share This Story