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President Muhammadu Buhari has said his administration cannot afford to subsidise Premium Motor Spirit, widely known as petrol, as Nigeria’s revenue has remarkably dropped.
The President disclosed this during the opening of the First Year Ministerial Performance Review Retreat at the Presidential Villa, Abuja.
Buhari said a return to the era of subsidy would lead to ‘several negative consequences,’ among which is the long queues at filling stations for hours before petrol could be bought.
His view has been countered by the Trade Union Congress (TUC) and the Academic Staff Union of Nigeria (ASUU), who called on President Buhari to fulfil his promise to rehabilitate the country’s refineries.
The Buhari administration had in March deregulated the petroleum sector allowing petrol prices to be regulated by market forces following the drop in crude price occasioned by COVID-19.
It led to the reduction of petrol price from N145 per litre to N125 per litre after the reduction od global oil prices in March.
However, the price of petrol has been increasing since then leading to the latest price of between N158 and N162 from N148 to N150 sold in August.
Speaking at the ministerial retreat, President Buhari, who was represented by Vice-President Yemi Osinbajo said one of the effects of the removal of subsidy was that petrol price would be determined by changes in global oil prices.
Reacting to the latest increase, Buhari said it was determined by the rise in global oil price.
According to the President, he said “There are several negative consequences if government should even attempt to go back to the business of fixing or subsidising the PMS price.
“First of all, it would mean a return to the costly subsidy regime. Today, we have 60 per cent less revenue, we just cannot afford the cost.
“The second danger is the potential return of fuel queues – which has thankfully, become a thing of the past under this administration.
“Nigerians no longer have to endure long queues just to buy petrol, often at highly inflated prices.
“Also, as I hinted earlier, there is no provision for fuel subsidy in the revised 2020 budget, simply because we are not able to afford it, if reasonable provisions must be made for health, education and other social services.”
President Buhari pledged to monitor petrol marketers to ensure the masses are not exploited for excessive gain.
“We will also remain alert to our responsibilities to ensure that marketers do not exploit citizens by raising pump price arbitrarily,” Buhari said.
This post was written by Obiajulu Joel Nwolu.
The views expressed here belong to the author and do not necessarily reflect our views and opinions.