Nigerians may soon pay as high as N234 for a litre of petrol, the group managing director of the Nigerian National Petroleum Corporation (NNPC) has said.
Mele Kyari explained Thursday that the federal government has been paying nearly N120 billion every month to subsidise the price of Premium Motor Spirit (PMS) also known as petrol, in a country that consumes an estimated 60 million litres of petrol daily.
The NNPC boss said the current “market price” of petrol is N234 per litre, but that through subsidy – which he said was becoming unsustainable – the price has been put at N162 so that it can be affordable.
Kyari lamented the burden NNPC has inflicted on itself by the ongoing subsidisation of the cost of petrol in the country. He said sooner than later Nigerians may have to pay the actual cost for the commodity.
Speaking at the fifth edition of the special ministerial briefings coordinated by the presidential communications team, he said: “Our current consumption is about N60 million litres per day; we are selling at N162 per litre and the current market price is N234, actual market price today.”
According to him, the difference between the two prices “multiplied by 60 million times 30 will give” the amount of money the NNPC spends per month in subsidy.
“I don’t have the numbers now, this is simple arithmetic we can do; but if you want the exact figures from our books, I do not have it this moment, but it is anywhere between N100 billion to N120 billion per month. I don’t have the exact number,” he said.
Kyari added: “Today, NNPC is the sole importer of fuel. We are importing at market price and we are selling at N162.”
He said looking at the current price situation, the market price could have been between N211 to around N234 per litre.
The meaning of this is that the consumers are not paying for the full value of petrol and therefore the NNPC is bearing that cost, he said.
“That is why early last year, you will recall the full deregulation of PMS and we have followed this through until September when the price shifted above N145.”
The NNPC boss however assured that the price will remain at N162 per litre in the month of April to allow the government hold talks with the organised labour on the situation.
“Disputes came up between us and the trade unions and the civil societies leading to an engagement between us and organised labour which prevented the implementation of the actual price of the petroleum product as at that time,” he recalled.
“These engagements continued and the objective of the engagement is actually not to prevent the implementation, but to make sure there is sufficient framework on the ground to ensure that consumers pay the actual price of this product and that they are not exploited.”