The subsidy represented the difference between the landing cost of imported gasoline and the regulated pump price at filling stations nationwide. On May 30, Kyari said the NNPC had funded the costly subsidy - estimated at $10 billion in 2022 - from its own tight cashflow, because the government was unable to cover it.ĭespite being Africa’s top oil producer, with current production of 1.4 million b/d of crude and condensate, Nigeria imports around 1 million-1.25 million mt/month of gasoline to meet national demand of around 50 million-60 million liters/day, due to the poor state of its refineries, which are currently down for repairs. Successive administrations have failed to scrap the subsidy program. Shortly after taking office, Tinubu announced Abuja would finally abolish its extremely costly gasoline subsidy, which he said could no longer be justified in the face of dwindling resources, and end the NNPC monopoly by allowing private companies to import fuel for domestic consumption. Kyari added that “there is no supply issue” and Nigeria’s current gasoline stock is capable of meeting demand for 32 days without new imports. Prices will go up and sometimes they will come down also.” “This is the meaning of making sure that the market regulates itself. “These are just prices depending on the market realities,” said Mele Kyari, CEO of Nigeria National Petroleum Corporation. The price of gasoline hit an all-time high of Naira 617/liter (81 cents/liter) on July 19, up from Naira 488/l six weeks ago, prompting protests by rights groups and labor unions. The price of gasoline has jumped 26% in Nigeria since new president Bola Tinubu ended a longstanding fuel subsidy on May 30, with the country’s state-owned oil company blaming market forces that now determine pump prices in a statement July 19. NNPC head blames ‘market forces’, claims 32-day stocksĮxperts blamed the price rises on rising global oil prices and a weak naira.Thank you for reading this post, don't forget to subscribe!.56 private companies have applied to import fuel.Gasoline prices up 26% since subsidy scrapped May 30.
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