Friday, 25 August 2023

Naira crumbles to 920/$, fuel marketers push for fresh price hike

Oil marketers, on Thursday, insisted on a possible hike in the pump price of petrol, following a further plunge in the value of the naira against the United States dollar
Oil dealers and marketers said on Thursday that with the exchange rate at N920/$, the pump price of petrol could not remain at N617/litre, particularly if the current exchange rate lingered.
The oil marketers, however, pointed out that since the Federal Government had insisted that it would not increase the petrol price, it must then be “subsidising the commodity secretly, based on the prevalent exchange rate reality.”
It was gathered that the ex-depot price of petrol was around N585/litre on Thursday. The projected cost of N680/litre, going by the current forex rate, means that the government might be forced to spend about N95/litre as subsidy.
Last week, the Nigerian Midstream and Downstream Petroleum Regulatory Authority stated that petrol consumption in Nigeria was about 52 million litres daily.
When this is multiplied by the estimated N95/litre projected subsidy and calculated for a month, it implies that the government could be forced to spend about N153bn as fuel subsidy monthly.
“I still maintain that since we are still importing petroleum products into this country, it has to do with forex. And once it has to do with forex, it means that so much naira will be chasing a few dollars.
“And since we don’t have the influx of dollars into Nigeria, the after effect is that the landing cost of petrol will continue to increase as long as the dollar continues to rise,” the National Public Relations Officer, Independent Petroleum Marketers Association of Nigeria, Chief Chinedu Ukadike, stated.
He added “The rise in dollar automatically leads to an increase in the cost of petroleum products, except the NNPCL is subsidising it through the Federal Government. I also recall the last statement by the Special Adviser to the President on Media, who said he got a brief from the president that the fuel price would not rise.

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