BY CHIKA OKEKE, Abuja
Ministers and Heads of Federal Government Agencies at a press briefing on ‘Fuel Prices and the Subsidy Question’ in Abuja on Thursday.
The Federal Government has offered a 30-day discount on petrol dispensed by the Nigerian National Petroleum Company Limited (NNPCL), with priority for public transporters nationwide.
As petrol price rises nationwide, the Federal Government is optimistic that the discount will ameliorate the plight of Nigerians, proposing a N1,350 per litre on the ex-gantry or landing cost of petrol, to keep pump prices stable, even as the price is subject to review monthly.
Minister of Finance and Coordinating Minister of the Economy, Prof Taiwo Oyedele, who stated this on Thursday while addressing journalists on ‘Fuel Prices and the Subsidy Question’, in Abuja, insisted that global crude or the exchange rate should not impact on pump prices.
The minister announced ten measures to ameliorate the high burden of fuel prices on Nigerians, which he said would not fully relieve the pressure on households.
They are margin discount at NNPC stations, forward sales of crude to domestic refineries, price modulation, removing illegal levies, more direct support and a faster Compressed Natural Gas (CNG) rollout.
This is in addition to an excess profit tax, less red tape, establishment of National Strategic Fuel Reserve and better traffic and logistics management.
He said: “We are offering a discount on petrol dispensed by NNPC Limited for the next 30 days, with priority for public transporters nationwide. As production rises and previously committed crude is freed up, this would shield pump prices from volatility in the global market.
“The government is negotiating a ceiling of N1,350 a litre on the ex-gantry or landing cost of petrol, to keep pump prices stable. Where costs rise above the ceiling, refiners and importers will carry the shortfall and recover it later, when crude prices or the exchange rate allows, without breaching the ceiling.
“This is neither a subsidy nor a price control: it is designed to smooth prices over time rather than suppressing them. The reasoning is simple. 1,400 naira a litre today and 1,400 tomorrow is better than 1,500 today and 1,300 tomorrow, because volatility itself adds to uncertainty and cost. And when fares go up sharply, they rarely come down as fast. The ceiling will be reviewed every month, reset where costs require, and the figures published for transparency.”
Oyedele disclosed that the Federal Government is working with states under the 2025 tax reform laws to remove illegal levies, curbing the road taxes and levies that inflate fares and logistics costs.
He stated that the government is increasing funding for cash transfers to the most vulnerable households, and for subsidised credit to small businesses and consumers, encouraging transporters to pass the savings on to passengers in lower fares for faster rollout of CNG.
On excess profit tax, Oyedele added: “We will consider this for operators who take undue advantage of consumers, anywhere along the energy value chain as the proceeds will be used exclusively to cushion the impact of fuel prices, through transport support or vouchers for urban minimum wage earners who are the most vulnerable.”
The minister stated that the government is working with the National Assembly to consider enhanced tax relief for low-income earners under the 2027 Finance Bill, while cutting regulatory costs that feed into the cost of doing business and, indirectly, into higher prices of goods and services.
To protect households and businesses from future energy shocks, the Federal Government is investing in a National Strategic Fuel Reserve, even as refined products will be released into the market under clear and published rules whenever a global disruption or hoarding threatens supply and price stability.
“This is not a subsidy and it does not fix prices, rather it secures supply and reduces price volatility. It will prevent artificial scarcity, deter market manipulation and anchor long-term energy security, so that a deregulated market delivers stable growth and not sudden price shocks,” he said.
For better traffic and logistics management, Oyedele pointed out that the traffic management agencies will improve the flow of traffic, especially in major urban centres to reduce fuel consumption, as the NIPOST’s newly launched address codes will make logistics more efficient and cheaper.
He added: “To be perfectly clear, none of these measures restores a blanket subsidy. To do so would amount to creating longer term harm for a short-term cure. Each measure is designed to reach the people who need help, without putting the wider economy at risk.”
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