By Ifeanyi Izeze
The first step to finding solutions to any problem is to first agree that indeed there is a problem. Living in denial will only complicate the situation and that’s exactly what we have in our hands today in this issue of appropriate pricing of petroleum products and the fuel subsidy scam.
On countless occasions before becoming the president, Gen Mohammadu Buhari had expressed doubts on the credibility of the subsidy claim as he argued that, subsidy as it was then, constituted the promotion of corruption and impunity and he vowed to eliminate it.
Now he is rounding up his four year tenure and rather than eliminate subsidy payments, things are much worse now under his nose. With petrol price at N145 per litre compared to N87 under the previous regime, and lower crude oil price today, petrol subsidy instead of dropping has skyrocketed. Is it not clear that we have been taken for a bad ride?
Recently, the Peoples Democratic Party (PDP) says its Presidential candidate, Atiku Abubakar, has worked out a pricing template that will immediately crash the pump price of fuel in the country, since the Buhari-led All Progressives Congress (APC) administration, in its insensitivity, has failed to do the needful in the last three years.
The party revealed that it has been in high level talks with top international players in the oil and gas industry, adding that its engagements has shown that the appropriate pump price of petrol in the Nigerian market, under the current subsidy regimes of the Buhari Presidency, should be within the borders of N87 to N90 per litre as against the N145 currently being charged.
The PDP said with the current price template of crude oil in the international market, the Buhari administration has no justification to keep the pump price of petrol at N145 per litre and watch Nigerians groan under the weight of high prices, while a cabal at the presidency loot the funds meant to subsidize the product.
Curiously, speaking through Festus Keyamo, Director, Strategic Communications of his Campaign Organisation, President Buhari described the promise by Atiku to crash fuel price from N145 to N90 at most if elected as President, as “laughable and a move geared towards dragging the country backward.”
As said by Buhari, “The claim by Alhaji Atiku Abubakar is opportunism of the highest order. Nigerians are aware that higher crude oil prices will translate to higher government revenues and a prudent administration will convert the resources to the benefit of the common man.
“This is exactly what President Muhammadu Buhari has done since he mounted the saddle in 2015. The President has worked out a transparent system whereby the whole subsidy regime and scam has been totally eliminated. There is no cash incentive or payment again to middlemen.”
Now this is where the President and his spokesperson should actually help us to understand them better. Is it that both Buhari and the people that speak for him are truly bamboozled about this subsidy thing or that they are out to outrightly deceive the entire country by deliberately obfuscating facts and figures as available to even the ordinary man on the street?
Amongst the allegations raised by the PDP was that for every N145 paid for a litre of petrol, the Presidency cabal diverts a hidden N58 which Nigerians have continued to pay since the fuel price was increased from N87 to presumably subsidized cost of N145.
This alleged scam has seen over N3.49 trillion stolen under the hidden N58 per litre of petrol on about 60 million litres daily domestic consumption figure that the NNPC has been working with for some time now.
NNPC had told us that the country’s consumption rate of Premium Motor Spirit (PMS) popularly called petrol was 28 million litres per day in December 2017.
Curiously, three months later, precisely by March 5 2018, the NNPC Group Managing Director, Maikanti Baru again openly claimed that the figure of the nation’s daily consumption had metamorphosed to 50 million litres per day and that NNPC had spent $5.8 billion (N1.7 trillion) on fuel importation in January and February this year meaning N774 million is paid daily as subsidy on petrol.
And in less than a month, the Minister of State Petroleum at a public forum in Abuja openly said the nation’s consumption rate of petrol has skyrocketed to 60 million litres per day and that the cost of subsidy is now over N1.4 trillion per annum. This figure means about N3.76 billion is spent daily on subsidising petrol. That is a staggering 386 per cent higher than the earlier figure of N774 million daily given in March 5, 2018 by the NNPC Group Managing Director for the importation and distribution of petroleum products in the country.
Right away let me show the President and his campaign spokesperson that it is very easy to crash the price of petrol to between N87-N90 per litre. All that is required is the will power to be honest, transparent and unfeigned patriotism.
First if we plug this N58 for every litre hidden leak orchestrated by the Buhari’s Presidency cabal, we will be talking of N87 per litre already. So what makes Keyamo and his Oga think it is an impossibility to draw down on the current price regime?
Also, when Dangote Refinery comes on stream in about a year from now, the story is going to be completely different from what we have now. So obviously, what is going on now in the subsidy scheme may be a last minute drive by the cabal at the Presidency to bleed the nation as much as they could before Dangote refinery comes on stream as that would eliminate if not all, at least a major chunk of the bills currently being tendered under the subsidy scheme and forced on the consumers to pay.
In all honesty, there is no way the daily consumption of petrol in the country could have skyrocketed from about 28 million litres to 60 million in less than one year. Is it that Nigerians are richer now than during the previous regime to consume more petrol? If this fraud in the figure of our daily consumption by the NNPC and the Presidency cabal is also checked, the subsidy, equalisation, and other associated bills will also crash.
All the noise about prices of petrol (PMS) at the international market is outright nonsense. What is NNPC doing with the 450, 000 barrels of crude oil it collects everyday supposedly for use in exchange for petroleum products for our domestic consumption?
No matter the reason, N145 price per litre of petrol is not justified. If they removed all the unnecessary additions on the cost such as bridging or Petroleum Equalisation Fund, dealer’s margin, transporter’s margin, retailer’s margin, storage, depot margin, and NPA charges, petrol price will come down to even about N80 per litre.
At the moment, no one knows exactly what the NNPC pays itself for subsidy which it now calls “under recovery”. At least before, we knew what NNPC was paying in subsidy (because of monthly reports that the corporation no longer issues regularly). You would understand why this government would want to keep it that way. But how long can we continue like this as a country? We can get Nigeria working again. God bless my country!!
(IFEANYI IZEZE: [email protected]; 234-8033043009)