Emmanuel OchayiThe Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has challenged President Bola Tinubu’s declaration that the era of fuel subsidies had ended.
PENGASSAN’s National President, Festus Osifo, who also serves as the President of the Trade Union Congress (TUC), stated on Channels Television’s ‘Politics Today’ that the Federal Government is, in fact, still paying subsidies for petrol.
Osifo said: “They [the government] are paying subsidy today.” He argued that with the fluctuating cost of crude oil in the international market and the exchange rate between the dollar and the naira, there are expectations that the price of fuel would increase, but it has remained stable which he said, showed that there is existing subsidy.
He further explained that “In reality today, there is a subsidy because as of when the earlier price was determined, the price of crude in the international market was somewhere around $80 for a barrel. But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, then the price [of petroleum] also needed to move.”
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Osifo asserted that for the government to cease subsidizing petroleum, two critical factors must align. “The only reason the price will not move is when you are able to manage your exchange rate effectively and you are able to pump in supply and bring down the exchange rate. So, if the exchange rate comes down today, we will not be paying subsidies. But with the exchange rate value and the price of crude oil in the international market, we have introduced subsidy,” he maintained.
This assertion by the PENGASSAN boss challenges the narrative of subsidy cessation and raises questions about the economic realities that continue to impact fuel prices in Nigeria.
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