Fuel Price May Rise To ₦302 Per Litre In Weeks

The National Economic Council, NEC, has recommended to the Federal Government an increase in the pump price of fuel.

The price of petrol in Nigeria currently sells between ₦162 and ₦165 per litre.

According to TheCable, the chairman of the council, Vice President, Yemi Osinbajo, made the recommendation in November 2021.

It was gathered that it is part of the plan of the Federal Government to deregulate the prices of Premium Motor Spirit (PMS) and eliminate monthly subsidy payments with provisions to ensure fair competition in the market.

A further report disclosed that the recommendations were made by NEC ad-hoc committee interfacing with the Nigerian National Petroleum Corporation (NNPC) on the appropriate pricing of PMS in Nigeria.

The report was said to have been presented by Governor Nasir El-Rufai of Kaduna State and the head of the Committee.

The report reads, “The recommendation has since been reconsidered and dropped by the committee. According to the new report, the committee recommended full deregulation of PMS prices by February 2022 raising the price by about ₦130/140 per litre.”

“It also recommended that all retailers should post PMS prices at all times on a designated website and smartphone app and they are expected to post price changes no earlier than within 15 minutes of the price change.

“With the recommendations, the committee added that the federal government would save ₦250 billion per month on petrol subsidy removal.

“At current rates, the PMS subsidy is reducing transfers into the federation by about NGN 250 billion per month, and could, if PMS subsidies are not eliminated, result in deductions of NGN 3 trillion in 2022.

“The large-scale time-limited (6-months) cash transfer proposed as a way of transferring the subsidy “directly to the people” would cost ₦600 billion but would by paving the way for the elimination of PMS subsidies, enable the federation to recover ₦3 trillion in revenues that would otherwise go to PMS subsidies.

“If PMS subsidies are eliminated by February 2022, ₦250 billion in deductions would have been incurred, but the remaining ₦195 billion in anticipated PMS subsidy deductions could be redirected towards FGN funding of the cash-transfer programme.”