N200 Petrol is Possible: Donald Duke Tells Tinubu What to Do to Slash Fuel Price
- Donald Duke urged President Tinubu to slash petrol prices by selling domestic crude to local refineries at its actual production cost
- He explained that Nigeria produces 1.7 million barrels of crude daily, but only 300,000 barrels are needed for local consumption
- By selling the other five by-products of crude oil at full commercial rates, the government can absorb the costs and deliver cheap petrol
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Legit.ng journalist Victor Enengedi has over a decade's experience covering energy, MSMEs, technology, banking and the economy.
Former Cross River State Governor Donald Duke has urged President Bola Tinubu to slash petrol prices by changing how domestic crude oil is priced.
Speaking in Abuja, the former Peoples Redemption Party (PRP) presidential candidate argued that the ongoing fuel subsidy debate misses a crucial point: Nigerian crude belongs to its citizens.
Source: UGC
Duke noted that while Nigeria produces roughly 1.7 million barrels of crude daily, only about 300,000 barrels are needed for domestic consumption.
Instead of charging local refineries international market rates, he argued that this domestic portion should be priced at its actual production cost.
"We produce about 1.7 million barrels. About 1.4 million barrels we sell commercially. These 300,000 barrels, look at the cost of production, not the international price.
While we sell oil at $70 or $80 a barrel, the cost of production may not exceed $40 a barrel. That barrel has about seven by-products," Duke stated.
Commercialising by-products for N200–N300 petrol
The core of Duke’s proposal relies on maximizing the value of the multiple by-products derived from a single barrel of crude oil. He pointed out that petrol is just one of several products extracted during refining and should not carry the financial burden of the entire barrel.
By selling the other by-products at full commercial rates and adding a modest margin to cover local refining and distribution, he maintains the government can easily lower petrol prices to between N200 and N300 per litre.
"Give it to us at the cost of production, not at the market price. Take into cognisance the cost of refining and distribution and put five or 10 per cent above it.
Sell the five other by-products from a barrel of crude at commercial rates. You will find that you can easily amortise the petrol and give it to your people at N200 or N300," he said.
Duke maintained that this strategy would deliver affordable energy to drive economic activity and lower fuel costs without returning Nigeria to the previous, unsustainable subsidy regime.
Source: Legit.ng
