The removal of petrol subsidy will no longer be immediate, Vanguard gathered authoritatively last night.
Recall that President Bola Ahmed Tinubu had said in his inauguration speech Monday that the subsidy was gone, as it was not provided for in the 2023 budget.
But sources told Vanguard yesterday that implementation of the removal of subsidy would commence post-June.
The need to clarify issues, sources told Vanguard, informed the meeting the President had with the governor of the Central Bank of Nigeria, CBN, and the Group Chief Executive Officer of Nigerian National Petroleum Company Limited, NNPCL, Mr. Mele Kyari, in the Presidential Villa, Abuja, yesterday.
It was learned that the essence of the meeting was to engage labour anytime from today to ensure the seamless removal of the subsidy.
A source said one of the fallouts of the meeting was for NNPCL to set up a template that would ensure that no toxic fuel was imported into the country and also create a benchmark for price.
The clarification came as scarcity of the product ground activities in major cities nationwide yesterday.
Yesterday, fuel queues emerged in many petrol stations as marketers who started hoarding fuel sold the product for as high as N600 per litre and transporters hiked fares.
From the South-West to the South-East, South-South to North-West and other zones of the country, it was tales of woe and fuel crisis gathered steam.
Tinubu resumes at Aso Rock, meets with Emefiele, Kyari
Meanwhile, President Bola Tinubu yesterday met with the governor of the Central Bank of Nigeria, CBN, Mr. Godwin Emefiele, and the Group Chief Executive Officer, of the Nigeria National Petroleum Company Limited, NNPCL, Mr. Mele Kyari, at the Presidential Villa, Abuja, on the matter.
This was the first official assignment by the President after his inauguration as the 16th president of the country at Eagle Square, Abuja
He arrived at the forecourt of the State House at about 2:30 pm through the quarter guard gate, which is his official entrance gate and was received by the Vice President, Senator Kashim Shettima, the Permanent Secretary, State House, Tijjani Umar, Speaker of the House of Representatives, Femi Gbajabiamila and the out-going Director of Protocol, DOP, Emefiele and Kyari, among others.
Although the agenda of the meeting was not made public, it may be in connection with the removal of fuel subsidies and the attendant fuel scarcity.
It was learned that the issue of unification of foreign exchange, and recent naira redesign was also discussed.
NNPCL backs Tinubu on petrol subsidy removal
The Nigerian National Petroleum Company Limited, NNPCL, has backed the removal of subsidy on petrol.
The Group CEO of NNPCL, Mele Kyari, said in Abuja that payments for petrol subsidy had been a huge burden on the company’s cash flow, disclosing that the Federal Government is owing the company N2.8 trillion it paid on petrol subsidy.
NNPC Limited was saddled with the payments for subsidy by former President Muhammadu Buhari with the company carrying the cost in its books as petrol under-recovery.
The company however deducts the cost from the revenue due to the Federation Accounts from the sales of Federation Crude Oil.
Speaking to journalists, Kyari said the NNPC Limited “welcomes the decision of Mr. President to announce that the subsidy on PMS (premium motor spirit) is over. This has been a major challenge for NNPC continued operations. We have been funding the subsidy from the cash flow of NNPC since the government is unable to defray the cost of the subsidy that is due to the corporation.
“We believe that this will free up resources for the NNPC to do the great work that this company is doing for our country and it allows us to continue to operate as a commercial entity”.
While assuring consumers that NNPC has enough stock of petrol in the supply system, he appealed the potential change in pump should not be enough reason for people to engage in panic-buying.
Also speaking, the Chief Executive of Nigerian Mainstream and Downstream Regulatory Authority, Faruk Ahmed, said that with the removal of subsidy, there would be no price cap on the sale of petroleum products in the country.
Ahmed said President Tinubu’s pronouncement in his inaugural speech on the removal of subsidy was in line with the law.
He said that the Federal Government has not been financing subsidies since 2022, adding, “the reality today is that the government cannot afford it.”
Subsidy ‘ll end Nigeria if….— Shettima
Meanwhile, as many state governments and some stakeholders kicked against the policy, yesterday, Vice President Kashim Shettima stressed the need to end fuel subsidies saying failure to do so would end the country.
Speaking to journalists on his first day in office at the Presidential Villa, Abuja, Shettima said Nigeria needs to get rid of fuel subsidy, arguing that the subsidy regime was not benefiting Nigerians but has been subsidizing the lifestyle of the rich.
He, however, assured that despite expected opposition from beneficiaries of fuel subsidy President Tinubu would frontally address the menace.
His words: “The President has already made pronouncements yesterday (Monday) on the issue of the fuel subsidy. The truth is that it is either we get rid of subsidy or the fuel subsidy gets rid of the Nigerian nation.
“In 2022, we spent $10billion subsidizing the ostentatious lifestyle of the upper class of the society. “We will get fierce opposition from those benefiting from the oil subsidy scam but where there is a will, there is a way. Be rest assured that our President is a man of strong will and conviction.
“In the fullness of time you will appreciate his noble intentions for the nation. The issue of fuel subsidy will be frontally addressed. The earlier we do so, the better.”
Reps back removal of oil subsidy
Indeed, members of the House of Representatives have thrown their weight behind subsidy removal and appealed to Nigerians to be patient with the new government.
The House of Representatives at plenary session hailed the removal of oil subsidy and
lauded the government for the decision, asking Nigerians to be patient with the new administration.
The commendation and the appeal came on the heels of a motion under matters of urgent public importance moved by Mr. Jimoh Olajide representing Lagos Mainland Federal Constituency of Lagos State.
TUC rejects subsidy removal, says it’s joke taken too far
However, the Trade Union Congress of Nigeria, TUC, in a statement by its President and Secretary General, Festus Osifo and Nuhu Toro, respectively, warned that it is a joke taken too far.
The body while assessing the President’s inaugural speech, said “”While listening to Tinubus’s Inaugural Address, we were at first encouraged by his pledge to lead as a servant of the people (and not as a ruler) and to always consult and dialogue, especially on key and knotty national issues. But we were subsequently taken aback, even horrified, when he announced the withdrawal of subsidy on petroleum products.
“If by this, he means increases in pump price and the exploitation of the people by unregulated and exploitative deregulated prices, then it’s a joke taken too far. It is not for nothing the Buhari government pushed this to the new administration. But we expect the Tinubu government to be wise on such a sensitive issue and be more explicit in its pronouncement to avoid contradictory interpretation when comparing his written statement, what he said and the provision in 2023 Appropriation Act.
“We dare say that this is a very delicate issue that touches on the lives, if not very survival, of particularly the working people. Hence, it ought to have been treated with utmost caution, and should have been preceded by robust dialogue and consultation with the representatives of the working people, including professionals, market people, students and the poor masses.
“Accordingly, we hereby demand that President Tinubu should tarry awhile to give room for robust dialogue and consultation and stakeholders’ engagement.”
“This new administration cannot be seen to be speaking from both sides of its mouth, we urge President Tinubu to be a President with a human face,” it added.
Don’t panic over removal of petrol subsidy — NMDPRA
Also, the Nigerian Midstream and Downstream Petroleum Regulatory Authority, NMDPRA, has cautioned against the current panic over the planned removal of petrol subsidy in Nigeria.
In a statement, NMDPRA said: “The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) wishes to address concerns regarding the announcement of the removal of subsidy on Premium Motor Spirit (PMS) by President Bola Tinubu.
“Contrary to speculations and concerns, the announcement is in line with the Petroleum Industry Act (2021) which provides for total deregulation of the petroleum downstream sector to drive investment and growth.
“We are working closely with NNPC Limited and other key stakeholders to guarantee a smooth transition, avoid any disruptions in supply as well as ensure that consumers are not short-changed in any form.
“The Authority assures that there is ample supply of PMS to meet demand as we have taken necessary steps to ensure distribution channels remain uninterrupted and fuel is readily available at all filling stations across the country. We, therefore, call on Nigerians to remain calm and resist the urge to stockpile as it poses a significant safety hazard.
“The NMDPRA reassures all Nigerians that the removal of subsidy on PMS is a step towards building a more sustainable and prosperous future for our nation. We will continue to monitor activities and implement necessary measures to enhance transparency and accountability in the petroleum downstream sector.”
MOMAN, DAPPMAN back FG
Also, the Major Oil Marketers Association of Nigeria, MOMAN, and Depot and Petroleum Marketers Association of Nigeria, DAPPMAN, endorsed the removal of fuel subsidy.
rances given by the Nigerian National Petroleum Company Limited, NNPCL, and the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), we wish to reiterate that there is no cause for alarm. We strongly urge Nigerians to avoid panic- buying or stockpiling of petrol.
“This behaviour not only creates artificial scarcity but also poses a significant safety hazard. The NNPCL has assured Nigerians of adequate fuel supply and the NMDPRA is working closely with stakeholders to ensure a seamless transition. They are ensuring distribution channels remain uninterrupted, thereby making fuel readily available at all filling stations across the country.
“The decision to phase out this fuel subsidy regime is not merely a fiscal reform; it is a significant stride toward social justice. We are heartened that the administration plans to redirect these substantial funds towards essential public goods such as infrastructure, education, and healthcare. These investments symbolize our shared future, promising considerable, long-term benefits for all Nigerians.
“We understand the concerns regarding potential price increases. However, we expect marketers to maintain reasonable pricing, as NNPCL remains the sole supplier of the product currently.
‘’We anticipate minimal changes regarding distribution costs, considering the cost of the product constitutes 80% of the pump price.
‘’We pledge, in collaboration with the Nigerian Association of Road Transport Owners, NARTO, and other crucial stakeholders, to manage these distribution costs diligently to minimize their impact on the pump price.
“Considering this policy clarity, we ask our suppliers to continue supplying products to all legitimate marketers. We also urge all stations to remain open and avoid hoarding products. We eagerly await the day when the Dangote Petroleum Refinery, as well as other licensed importers, join the current supplier in a bid to diversify the source of petroleum products and enhance market competition.
“MOMAN and DAPPMAN will maintain an open dialogue with the Federal Government, advocating for stability in the oil sector during this transitional period. We are prepared to support any measures from the Government that would help cushion the impact on the populace. We once again laud President Tinubu for his bold vision and stand ready to collaborate with his administration in its effort to promote greater economic equality.