FG Rejects Governors Proposal To Increase Fuel Price

THE Federal Government has again rejected a proposal by the Nigeria Governors Forum to increase fuel price.

The development is coming barely three months after the Federal Government turned down the recommendation by the forum for an increase in the price of petrol to between N380 and N408.5 per litre and removing subsidy.

The advice by the governors was based on the report of its committee chaired by the Kaduna State Governor, Mallam Nasir El-Rufai, seeking the full deregulation of the oil sector.

While presenting the report of his committee to the NGF, El-Rufai  explained that the current subsidy regime was unsustainable because smugglers and illegal markets in neighbouring African countries were the beneficiaries.

But in a statement, the Minister of State for Petroleum Resources, Chief Timipre Sylva, confirmed that the current petrol price of between N162 and N165 per litre would stay.

Sylva said the current price would be retained until the ongoing negotiations with the organised labour were concluded.

He said, “Once again, it has become necessary to assure Nigerians that despite the huge burden of under-recovery, the Federal Government is not in a hurry to increase the price of Premium Motor Spirit (petrol) to reflect current market realities.

“The current price of petrol will be retained in the month of June until the ongoing engagement with organised labour is concluded. This clarification becomes necessary in the light of recent reports regarding the resolution of the Nigeria Governors’ Forum to increase the pump price of petrol.”

Sylva also asked oil marketers not to engage in any activity that could jeopardise the seamless supply and distribution system of the commodity.

Despite the Federal Government’s initial stance, oil marketers under the aegis of Petroleum Products Retail Outlets Owners Association of Nigeria, on Friday, demanded an immediate end to fuel subsidy in line with the state governors’ recommendation of May.

The President of PETROAN, Dr Billy Gillis-Harry, insisted that oil marketers’ position that fuel subsidy should be stopped remained.

“When it (fuel subsidy) is stopped, the prices of petroleum products will be determined by market forces and this will create competition and lead to an increase in product availability,” he said.

Gillis-Harry asked the Federal Government to listen to the governors’ call, especially now that the country was grappling with funding challenges.

But the Federal Government reiterated its stance of May, stating that no decision on the adjustment of petrol price would be reached until the ongoing negotiations with the organised labour were concluded.

The Special Assistant on Media to the Minister of State for Petroleum Resources, Garba-Deen Muhammad, stated that he would re-echo the position of his boss, Sylva, who had earlier stated the position of the Federal Government on the matter.

Muhammad said people were free to make analyses and recommendations but stressed that the government’s position on petrol price had not changed.

He said, “The truth is that the key component for us to make the decision is basically for us to have a consensus with labour. So regardless of what the governors or anybody else is saying, labour is the key partner in this project.

“The negotiations with labour officials are ongoing. A decision will not be reached until the negotiations are over. So anybody can say what they want. The fact is that the labour represents the Nigerian people and the government is working with the Nigerian people. So it is a cardinal objective that the labour is carried along.”

Asked when the negotiations would possibly be concluded, Muhammad stated that the deadline was not completely dependent on the Federal Government.