N720 Per Litre: FG Denies Reinstating Subsidy as Fuel Stations Shut Down

• The Federal Government has reacted to claims that it secretly paid subsidy on fuel
• It stated that the closure of petrol stations was due to issues in the downstream oil industry
• NNPCL has also stated that Nigeria will start exporting refined petroleum products by next year

The Federal Government, through the Nigerian National Petroleum Company Limited, has denied claim that reinstated the subsidy on Premium Motor Spirit (PMS), more popularly known as petrol.

The reaction comes amid widespread closure of petrol stations over issues in the downstream oil industry.

NNPCL said the delays in product transportation from the South to the North were to blame not a shortage of supplies.

The NNPCL also stated on Monday, October 9, that if President Bola Tinubu had not stopped the subsidy on PMS in May, the company would have declared bankruptcy in June of this year.

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Nigeria to export refined products by next year

Punch reported that NNPCL declared that Nigeria will start exporting refined petroleum products by from next year, following efforts to modernise its refineries.

Nigeria has imported PMS and other refined petroleum products throughout the nation through the NNPCL for many years.

Following a meeting with Tinubu at the Aso Rock Villa, Mele Kyari, the Group Chief Executive Officer of NNPCL, informed State House Correspondents that the gasoline subsidy had not been reimbursed.

He stated:

No subsidy whatsoever. We are recovering our full cost from the products that we import. We sell to the market, and we understand why the marketers are unable to import. We hope that they do it very quickly and these are some of the interventions the government is doing. There is no subsidy.

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Kyari's claim was made just 48 hours after the Nigerian Petroleum and Natural Gas Senior Staff Association announced the reinstatement of fuel subsidies.

Marketers say subsidy is back

Meanwhile, oil marketers had consistently claimed that fuel subsidies had returned, citing N720/litre as the landing cost of petrol as of last week.

Depending on the location, the commodity is currently offered for between N580 and N617 per litre, according to marketers

Festus Osifo, the National President of PENGASSAN, asked the government to continue subsidising petrol because of the price of crude oil on the world market and the currency rate.

“They [government] are paying subsidy today. In reality, today, there is subsidy because, as of when the earlier price was determined, the price of crude in the international market was around $80 for a barrel.

“But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, the price [of petroleum] also needed to move. The only reason the price will not move is when you can manage your exchange rate effectively and you can pump in supply and bring down the exchange rate."

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Fuel Subsidy is Back: Dangote Shuns Refining of Petrol for Diesel, Aviation fuel.

Following the reported resumption of fuel subsidy under Tinubu's government, the Dangote Refinery and other Nigerian modular refineries moved their emphasis away from refining Premium Motor Spirit (PMS), Legit.ng reported.

The government was said to have secretly paid about N169.4 billion as subsidy to keep petrol at N620 per litre in August.

Source: Legit.ng