News
Petrol price may hit N1,800/litre over Dangote’s subsidy removal call in Nigeria
By Mario Deepromoter
Dangote Petroleum Refinery, the sole producer of petrol being off taken and distributed for Nigerians, has declared that the government should end subsidy, a move that would cause an imminent surge in the prices of the product to as high as N1,800 litre.
The Founder of the 650,000 barrels per day capacity refinery, Alhaji Aliko Dangote, who threw his full weight behind subsidy removal just nine days after his facility started production of petrol, said in an interview with Bloomberg that this is the right time for the federal government to stop petrol subsidy.
The product, which sold for N650 per litre at the NNPCL outlets before September 15, skyrocketed to as high as N1,010 per litre in the same outlets on the day the private refinery began production. With the call for full subsidy removal, the prices could be as high as N1,800 per litre.
“I think it is the right time to (take away subsidy) because all countries have gotten rid of subsidy,” he said.
Statistics showed that the price of the product would go up to the market price which is higher than the subsidised price any time the subsidy is removed, but Dangote maintained that what actually increases a product’s price is the subsidy.
Subsidy, according to him, is a sensitive issue, adding that once a country subsidises the product, people would increase the price.
To Dangote, the subsidy would lead to the government “paying what they are not supposed to be paying.” Dangote said petrol subsidy is not sustainable and the government cannot afford to keep subsidising.
“Our price of gasoline is about 60 per cent the price of our neighbouring countries and we have porous borders, so it is not sustainable. Government cannot afford the amount of subsidies we are paying,” he said.
Speaking further on the viability of petrol subsidy, Dangote said it is the government’s decision to either continue with or halt the payments.
“We have a choice of exporting when we produce and we sell locally. We are a private company and it is true we have to make a profit,” he said.
We built something worth $20 billion, and definitely we have to make money.
“The removal of subsidy is totally dependent on the government, not on us.
“We cannot change the price but I think the government would have to give up something for something.”
Dangote said eventually, the subsidy would have to go, adding that the petrol sold locally by his refinery will be tracked to ensure the consumption rate is accounted for.
“But this refinery will bring quite a lot of issues out there. It would show the real consumption of Nigeria because nobody can tell. Some people say it is 60 million litres per day, some say it is less,” the billionaire said.
“But right now, by us producing, everything can be counted and accounted for. Most of the trucks or ships that will load from us, we will put a track on them to be sure they are going to take the oil within Nigeria and that can help the government to save a lot of money.
“For example, in Saudi, citizens believe that oil is our god-given gift and should not charge for it. The government was selling it at a very low price. But today, as we speak, gasoline is about 40 per cent cheaper in Nigeria than in Saudi Arabia, which I think does not make sense.”
On May 29, 2023, President Bola Tinubu said the petrol subsidy regime was over.
Almost three months later, TheCable reported that Tinubu was considering a “temporary subsidy” on petrol as crude oil prices and foreign exchange rates soared.
However, Ajuri Ngelale, former presidential spokesperson, said there was no reintroduction of subsidy.
Also, on January 3, the Nigerian National Petroleum Company (NNPC) Limited denied the return of the petrol subsidy, saying it had been removed entirely.
However, on April 15, Nasir el-Rufai, former governor of Kaduna state, said the federal government is spending more on petrol subsidy than before.
TheCable also reported on August 19 that Tinubu approved a request by NNPC to utilise the 2023 final dividends due to the federation to pay for the petrol subsidy — but NNPC denied the existence of petrol subsidy, only to admit hours later that the federal government owes it N7.8 trillion for subsidising petrol.
Almost a month later, Tinubu said Nigeria’s daily consumption of petrol was reduced to about 30 million litres after subsidy removal.
By Mario Deepromoter
The Academic Staff Union of Universities has issued a 14-day strike deadline to the Federal Government to resolve some lingering issues dating as far back as 2009.
ASUU President, Emmanuel Osodeke in a statement issued on Wednesday, said the body is seeking the conclusion of the renegotiation of the 2009 FGN/ASUU Agreement based on the Nimi Briggs Committee’s Draft Agreement of 2021.
It also demanded the release of withheld salaries due to the 2022 strike action, and expressed frustration with the government’s lack of commitment and delay tactics.
It stated that these actions were generating a crisis in the public university system.
“In view of the foregoing, ASUU resolves to give the Nigerian Government another 14 days, in addition to the earlier 21 days, beginning from Monday, September 23, 2024, during which all the lingering issues must have been concretely addressed to the satisfaction of the membership of the union.
“The union should not be held responsible for any industrial disharmony that arises from the government’s failure to seize the new opportunity offered by ASUU to nip the looming crisis in the bud,” ASUU said
ASUU is also demanding the release of unpaid salaries for staff on sabbatical, part-time, and adjunct appointments affected by the Integrated Payroll and Personnel Information System, and the payment of outstanding third-party deductions such as check-off dues and cooperative contributions.
It added that it wants funding for the revitalisation of public universities, partly captured in the 2023 Federal Government Budget, and the payment of Earned Academic Allowances partly captured in the 2023 Federal Government Budget.
Other issues include the proliferation of universities by Federal and State Governments, the implementation of the reports of visitation panels to universities, the reversal of the illegalG dissolution of Governing Councils, and the adoption of the University Transparency and Accountability Solution as a replacement for IPPIS.
By Kayode Sanni-Arewa
Akwa Ibom on a standstill over strike by the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the National Union of Petroleum and Natural Gas Workers (NUPENG) over the seizure of a tankers by the Joint Task Force (JTF).
The absence of fuel in the state has brought economic activity to a grinding halt, as businesses struggle to operate without transportation or power.
“This is unbearable! I have had to close my shop for three days because my customers can’t find a means to come and buy from me. Even the little I have in my fridge is getting bad because there is no light,” lamented an angry shopkeeper in Uyo.
Others said that the fuel scarcity has had a ripple effect on every aspect of daily life, with school and work attendance taking a hit as people are unable to commute. Even hospitals have not been spared from the consequences of the crisis, as ambulances are unable to transport patients in need of critical care.
The crippling effect of the ongoing strike in Akwa Ibom has prompted the state chapter of the Nigeria Labour Congress (NLC) to announce that they will commence a “sit-at-home” this evening. This was confirmed in a statement signed by the NLC Chairman, Comrade Sunny James, who expressed deep concern over the situation and called for urgent intervention by relevant authorities.
GOVERNMENT KEEPS MUM
Government agencies that regulate petroleum products has remained silent on the matter despite the growing outrage from citizens and the NLC’s protest announcement. The absence of a statement or public address from the agencies and Akwa Ibom Government has fueled concerns over the government’s handling of the situation, as many fear that the prolonged crisis could have dire consequences for the state’s economy and overall well-being.
“We are tired of this silence from those who should talk. We want answers and action now. This is affecting the livelihoods of every person in this state. What is he waiting for?” cried a frustrated resident of Uyo.
REASON FOR STRIKE BY NUPENG
A source close to the matter revealed that NUPENG did not take the necessary steps to engage with authorities, including the DPR Coordinator and the Chief of Army Staff, to resolve the issue of seized trucks.
The source also claims that the product was illegally diverted to an unlicensed fuel station for export, which may have further exacerbated the situation.
According to the source, the Governor’s hands may be tied in this matter due to the alleged illegalities involved, stating,
“NUPENG didn’t do enough to address the issue. The product was diverted illegally. Even the Governor might not be able to intervene in such a situation.”
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