- Nigerians may have to pay more for petrol if the federal government stops injecting money monthly to subsidise the price of the product
- Mele Kyari, the group managing director of NNPC, has disclosed the amount the federal government spends monthly on petrol subsidy
- However, some Nigerians have warned that the prices of commodities in the country would rise if subsidy on petroleum products is removed totally
FCT, Abuja - The group managing director of Nigerian National Petroleum Corporation (NNPC), Mele Kyari, says Nigerians should be paying at least N256 per litre for petrol given the current exchange rate.
Kyari made the statement at a stakeholders meeting organised by the NNPC to stop fuel smuggling on Wednesday, June 23, Daily Trust reported.
The NNPC boss, however, stated that the federal government is injecting between N140 billion to N150bn monthly to keep petrol price at N162 per litre, from its actual N256.
“If we are to sell at the market today at current exchange rate, we will be selling the product at about N256 to a litre. What we sell today is N162, so the difference is at a cost to the nation.
“The difference comes back to as much as N140bn to N150bn cost to the country monthly.”
Kyari says petrol subsidy not sustainable
According to The Nation, Kyari explained that the country cannot sustain subsidy payment with the high volume of daily consumption.
He noted that smuggling across the borders increased the daily consumption of Premium Motor Spirit (PMS) to 103 million litres per day in May.
The NNPC boss explained that the introduction of Operation White and involvement of the Economic and Financial Crimes Commission (EFCC) had checked the smuggling situation.
NNPC to borrow $2.5billion to fund stake acquisition in Dangote Refinery
Meanwhile, NNPC is planning on securing $2.5 billion from the African Export-Import Bank to buy a stake in the Dangote refinery.
The government-owned company said it a 20% stake in Dangote Refinery and has begun negotiations with representatives of the company - that talk seems to have warranted a need for NNPC to raise $2.5 billion.
Aside from Dangote Refinery, the oil importer is also aiming for stakes in five other privately-owned refineries within the country, most of which are still in the development phase.