Mixed Reactions as Government Increases Fuel Price to N145

It has been a long standing argument by critical assessors of the economy that deregulation remains the tonic to turn around the fortunes of the downstream sector of the oil and gas industry. Those who canvass this position argue that it will provide enduring solution to the recurring scarcity of petroleum products and halt the corruption in the subsidy regime.

The payment of subsidy has been digging a hole in Federal Government’s purse to the tune of about N1trillion annually.

Apart from halting the payment, which not a few Nigerians describe as a scam,
deregulation will also encourage investors to build refineries and sell products at market prices, boost investments and create jobs.

More importantly perhaps, those clamoring for deregulation say that it will end the paradox of a nation dependent on importation of petroleum products despite being world’s sixth largest oil producer.

However, the Federal Government’s announcement of an increase in the pump price of Premium Motor Spirit (PMS), otherwise called petrol to N145 per liter did not go down well with some.

Labour union leaders are literarily up in arms over the decision. Some of them, who spoke with The Nation, could barely hide their anger and frustration over what they termed as “wrong timing and ill-conceived” manner the Federal Government deregulated the sector.

But the Director-General, Enugu Chamber of Commerce, Industry, Mines and Agriculture (ECCIMA), Sir Emeka Okereke, said:“We have always said let subsidy go; deregulate so that market forces will determine the price of petroleum products and the dollar.” . He recalled that because of political exigency, Goodluck Jonathan failed to take the bull by the horns and deregulate the sector.

He said this was why the administration buckled under the pressure by labour unionists and civil society in 2012 when there was a nationwide protest against the removal of fuel subsidy.

“Subsidy doesn’t make economic sense anymore. It has become unsustainable. We will never come out of the woods as long as we continue to subsidize the price of petroleum products,” Okereke said.

The Petroleum Products Pricing and Regulatory Agency (PPPRA), which statutorily moderates pricing for the industry said Nigerian National Petroleum Corporation (NNPC) Retail stations on the outskirts of major cities are advised to sell at price lower than N145/litre.

Labour kick, says increase is unacceptable
NLC President Ayuba Wabba claimed that increase in pump price of petroleum products would impoverish more Nigerians and distabilise the country. “Any increase in the price of petroleum products is unacceptable to labour and we are going to fight it,” he threatened.