Subsidy Removal: NNPCL announces new pump price at N488, N555 per litre

Reports said that the prices have been fixed at N488 and N555 per litre at the peak, effectively marking the end of the fuel subsidy era.

This decision follows shortly after the newly elected President, Asiwaju Bola Ahmed Tinubu, declared the termination of fuel subsidy in Nigeria.

Earlier, there were highlights of growing indications of an imminent spike in petrol prices, with a leaked document revealing a troubling retail price of over N500 per litre.

This revelation had thrown the downstream sector of Nigeria’s petroleum industry into confusion.

It was learnt that during a meeting held by NNPC stakeholders on Wednesday morning, it was agreed upon and approved by the management to revise the NNPC PMS pump price table for Mega/Standard/Leased Stations.

Subsequently, all marketers were instructed to adjust the retail prices of petroleum products across different states.

Previously, it was assumed that the fuel price would be determined at a later date. However, the management has now rolled out a new table of retail prices for various geopolitical zones in the country, directing marketers to implement the changes immediately from Wednesday, May 31, 2023.

In an official statement to the press, the management stated, “Please implement meter change as approved, effective today, May 31, 2023. Wayne is to attend to all locations as relates to their area of coverage in our network.”

As per the revised price schedule, the highest petrol prices will be seen in Maiduguri and Damaturu, where it will be sold at N557 per litre. In the rest of the Northeast zone, the price will be N550 per litre.

Birnin Kebbi will witness the highest prices in the Northwest zone, purchasing petrol at N545 per litre. The North Central zone is set to experience an average price of N537 per litre, with the exception of Ilorin, where it will be sold at N515 per litre. Consumers in the Southeast region can expect to pay an average of N520 per litre.

With the exception of Uyo and Yenegoa, where petrol will now be priced at N515 per litre, the rest of the Southsouth zone will receive the product at N511 per litre.

Consumers in Lagos will enjoy the lowest price, as petrol will be sold at N488 per litre. The rest of the Southwest zone will have access to the product at N500 per litre.

Sources said the President held high-powered meeting in the Presidential Villa, Abuja, yesterday with the governor of the Central Bank of Nigeria, Godwin Emefele and the Group Chief Executive Officer of Nigerian National Petroleum Company Limited, NNPCL, Mr. Mele Kyari.

A source said one of the fallouts of the meeting was for NNPCL to set up a template for price benchmark.

The Group CEO of NNPCL, Mele Kyari, said in Abuja that payments for petrol subsidy had been a huge burden on the company’s cash flow, disclosing that the Federal Government is owing the company N2.8 trillion it paid on petrol subsidy.

NNPC Limited was saddled with the payments for subsidy by former President Muhammadu Buhari with the company carrying the cost in its books as petrol under-recovery.

The company however deducts the cost from the revenue due to the Federation Accounts from the sales of Federation Crude Oil.

Speaking to journalists, Kyari said the NNPC Limited “welcomes the decision of Mr. President to announce that the subsidy on PMS (premium motor spirit) is over. This has been a major challenge for NNPC continued operations. We have been funding the subsidy from the cash flow of NNPC since the government is unable to defray the cost of the subsidy that is due to the corporation.

“We believe that this will free up resources for the NNPC to do the great work that this company is doing for our country and it allows us to continue to operate as a commercial entity”.

While assuring consumers that NNPC has enough stock of petrol in the supply system, he appealed the potential change in pump should not be enough reason for people to engage in panic-buying.

Also speaking, the Chief Executive of Nigerian Mainstream and Downstream Regulatory Authority, Faruk Ahmed, said that with the removal of subsidy, there would be no price cap on the sale of petroleum products in the country.

Subsidy ‘ll end — Shettima

Meanwhile, as many state governments and some stakeholders kicked against the policy, yesterday, Vice President Kashim Shettima stressed the need to end fuel subsidies saying failure to do so would end the country.

Speaking to journalists on his first day in office at the Presidential Villa, Abuja, Shettima said Nigeria needs to get rid of fuel subsidy, arguing that the subsidy regime was not benefiting Nigerians but has been subsidizing the lifestyle of the rich.
He, however, assured that despite expected opposition from beneficiaries of fuel subsidy President Tinubu would frontally address the menace.

His words: “The President has already made pronouncements yesterday (Monday) on the issue of the fuel subsidy. The truth is that it is either we get rid of subsidy or the fuel subsidy gets rid of the Nigerian nation.

“In 2022, we spent $10billion subsidizing the ostentatious lifestyle of the upper class of the society. “We will get fierce opposition from those benefiting from the oil subsidy scam but where there is a will, there is a way. Be rest assured that our President is a man of strong will and conviction.

“In the fullness of time you will appreciate his noble intentions for the nation. The issue of fuel subsidy will be frontally addressed. The earlier we do so, the better.”

Reps back removal of oil subsidy

Indeed, members of the House of Representatives have thrown their weight behind subsidy removal and appealed to Nigerians to be patient with the new government.

The House of Representatives at plenary session hailed the removal of oil subsidy and
lauded the government for the decision, asking Nigerians to be patient with the new administration.

The commendation and the appeal came on the heels of a motion under matters of urgent public importance moved by Mr. Jimoh Olajide representing Lagos Mainland Federal Constituency of Lagos State.