FG Blames Marketers for Hike in Petrol Price

By Adedapo Adesanya

The Minister of State for Petroleum Resources, Mr Timipre Sylva, says the federal government is not responsible for the increase in the price of Premium Motor Spirit (PMS), otherwise known as petrol.

According to Mr Sylva, the government is still subsidising petrol, with provision made to do that for the next few months.

Speaking at the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) stakeholders’ consultation forum on regulations, Mr Sylva said the marketers are most likely to blame.

“I can tell you authoritatively that we have not deregulated,” he said.

“The government is still subsidising. If there are increases in price, it is not from the government. It is probably from the marketers.

“But I will talk to the authorities to actually regulate the price. But this is not from the government. We have not deregulated,” he added.

While the official pump price of the product is pegged at N165 per litre, many filling stations have been selling for as high as N180 and N185.

Meanwhile, petrol subsidy claims continue to skyrocket.

According to the Nigerian National Petroleum Company (NNPC) Limited, petrol subsidy claims reached N2.6 trillion in the first half of 2022, surpassing revenue generated from the sale of crude oil.

Last month, the central government projected to spend N6.7 trillion on petrol subsidy payments in 2023.

Speaking at the presentation of the 2023-2035 Medium Term Expenditure Framework & Fiscal Strategy Paper (MTEF&FSP) in Abuja, the Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, said subsidy payment projection is based on two prevailing scenarios — business-as-usual or reform.

“Scenario 1 is the Business-as-Usual. This is assuming that the subsidy on PMS, which is estimated at N6.72 trillion for the full year 2023, will remain and be fully provided for,” she said.

“Scenario 2 – the Reform scenario: This assumes that petrol subsidy will remain up to mid-2023 based on the 18-month extension announced early 2021, in which case only N3.36 trillion will be provided for.”

She, however, said both scenarios have implications for net accretion to the federation account and projected deficit levels.