Business
Tinubu lied about fuel subsidy removal –PENGASSAN
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has claimed that the Federal Government is still paying subsidies on petrol.
This is contrary to the pronouncement of President Bola Tinubu in his inaugural speech, where he declared that the subsidy era was gone.
Upon assuming office in late May, Tinubu embarked on some of Nigeria’s biggest reforms in decades, including floating of the country’s currency, the naira.
Fuel prices have more than tripled since the subsidy removal and the currency has weakened against the U.S. dollar. The developments increased pressure on the government to ease the suffering caused by the policies.
Festus Osifo, the National President of PENGASSAN, who also doubles as the President of Trade Union Congress of Nigeria (TUC), made the claim while appearing on Channels Television’s Politics Today on Friday night.
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According to Osifo, due to the cost of crude oil in the international market and the dollar to naira rate, the government still pays subsidies for the product.
‘They [government] are paying subsidies today.”
Speaking further, Osifo said: “In reality today, there is subsidy because as of when the earlier price was determined, the price of crude in the international market was somewhere around $80 for a barrel. But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, then the price [of petroleum] also needed to move.”
For the government to stop subsidising petroleum, he said two things must happen.
“The only reason the price will not move is when you are able to manage your exchange rate effectively and you are able to pump in supply and bring down the exchange rate.
“So, if the exchange rate comes down today, we will not be paying a subsidy. But with the exchange rate value and the price of crude oil in the international market, we have introduced subsidy”, Osifo maintained.
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