Oil marketers have revealed that if the Federal Government goes ahead with its plan to remove the subsidy on Premium of Motor Spirit, popularly called petrol, the cost of the commodity would cross N800/litre.
It has been widely reported by those working in the oil industry that the high price of gasoline subsidies has been a burden on the Nigerian National Petroleum Company Limited and has played a role in the ongoing crisis in the downstream oil sector. It would also be noted that in Nigeria, only NNPC is allowed to import petrol.
AMBusiness reported that Minister of Finance, Budget and National Planning Zainab Ahmed had proposed phasing off PMS subsidies, citing an impending June 30th deadline for the subsidy’s corresponding financial allotment.
However, oil marketers have warned that while it could be beneficial to end subsidies, consumers in Nigeria should be prepared for gas prices to rise above N800 per liter once the commodity is no longer subsidized.
They encouraged the Federal Government to ensure that the required mechanisms and infrastructure were put in place to provide a less stressful subsidy removal regime before executing the decision.
The Secretary, Independent Petroleum Marketers Association of Nigeria, Abuja-Suleja, Mohammed Shuaibu, stated,”If the government fails to take the appropriate measures, and they say they want to remove fuel subsidy, the situation will be worse than this, the masses will suffer. How can you remove subsidy and you don’t have this product (petrol)”.
He added, “If the government removes subsidy, where is the product? If you are removing subsidy, maybe by that time, the way diesel is sold at between N800 – N900/litre, we could be buying petrol at N800/litre, if not more than that.
“This is because the product will be scarce, even from the government cycle. So the government should tell Nigerians the truth about this fuel supply crisis. It is not a problem caused by marketers,” he added.