The former President of the Society Of Petroleum Engineers, Joe Uwakwue, has claimed that President Bola Tinubu’s administration is still paying petrol subsidy despite publicly announcing to Nigerians in May 2023 that the subsidy had been officially removed.
The IMF had earlier called on Tinubu’s government to ensure a complete phase-out of fuel and electricity subsidies despite the rising inflation and high cost of living in the country.
El-Rufai affirmed that the development has so far cost the present administration trillions of naira since inception, adding that if not because of the subsidy payments, the price of petrol per litre could have been much higher than the diesel.
Diesel is currently sold above N1,000 depending on the location, compared to PMS which is between N600 and N750 per litre.
Similarly, speaking on Arise News Television’s The Morning Show programme, former President of the Society Of Petroleum Engineers, Uwakwue explained that with the landing cost of fuel at $950 per ton, plus a premium of at least $10, Nigerians would be required to pay about N925 at the pump as against N600 to N750 or thereabouts being paid as pump price.
According to Uwakwue, the Nigerian government and the sole importer of fuel, the Nigerian National Petroleum Company Limited (NNPCL) are covering the difference of over N300 per litre as the subsidy.
He said, “The numbers don’t lie. If you look at the current pump price today, it is probably N600 average. To land it (fuel) in Nigeria today at $950 per ton will require that you pay N900 at the pump, a little bit above actually.
“If you think of the premium that you pay, maybe $10, I’m assuming the lowest premium which is $10. If it is $15, the pump price will be N925. So, yes, we are paying subsidy.”
Uwakwue, who said that the Nigerian government is paying above N300 per litre as subsidy, noted that “it is probably N310 per litre.”
Asked where the government was getting the funds being used to pay subsidy from as he claimed, Uwakwue said, “Certainly not from the end user. The end user pays N600 or whatever it is and goes away.
“So, it is between the government and the sole importer, NNPCL. Between these two, they are paying the difference.
“Think about it, if the landing cost is above N800, and you add all the distribution expenses, it is reasonable to expect that if you are to sell it without a loss, it will be at least N900.”
