Oil Firm Boss, Tunji Oyebanji, Warns FG Against Fuel Subsidy Removal

The Federal Government has been warned by the Managing Director of 11 Plc, formerly Mobil Oil Nigeria Plc, Tunji Oyebanji, of the impact fuel subsidy removal will have on Nigerians.

Oyebanji said before the government goes ahead to remove the subsidy, there’s a need for stakeholders’ engagement to have better knowledge of the ripple effect. 

He said with the country struggling with foreign exchange scarcity and multiple forex rates, the removal of subsidy could cause a significant rise in fuel price at the filling station. 

This was disclosed in a report by The Sun on Monday, which says Oyebanji questioned where oil marketers will be expected to source for forex to import or buy fuel that will be sold to Nigerians at the petrol stations. 

Recall that President Muhammadu Buhari had stated that fuel subsidy will be removed in the second quarter (Q2) of 2023, to save the country’s revenue.

He explained that in the official market, the foreign exchange rate is about N450 to a Dollar, but it goes for N730 to a Dollar in the black market.

Oyebanji wondered if the government will allow the oil companies to access Dollars in the official market to buy the refined product or if the firms will have to approach the black market where the United States currency is sold at a significant price. 

The manager said if the firms are forced to buy from the black market, then Nigerians will have to pay significantly to buy fuel at the pump, as the cost of purchasing the USD will be passed to the customers. 

‘‘If we are to start importing petrol today, are we going to be getting exchange rate at the official price or we have to source from the black market at over N730 to a Dollar as against the official price of N450 to a Dollar. If it is to be sourced at the black market that means it will shore up the price of petrol and Nigerians must be prepared to pay this price 

‘‘If NNPC stops importing today when it eventually ceases to subsidize petrol, does that mean there would be no product?” Oyebanji asked.