The Nigerian National Petroleum Corporation is currently subsidising Premium Motor Spirit, popularly known as petrol, by about N1.5bn every day.
Although the corporation insisted that it was not paying subsidy on petrol as it had no parliamentary approval for such, it revealed that what the NNPC currently incurred as under-recovery on PMS was between N20 and N25 per litre.
The NNPC is the sole importer of petrol into Nigeria, a role it has maintained for more than a year after oil marketers stopped importing the commodity due to the Federal Government’s decision to halt the payment of fuel subsidy to marketers.
Speaking on the sidelines of an inspection tour of filling stations in Abuja, the Group Managing Director, NNPC, Maikanti Baru, noted that the corporation imported about 60 million litres of petrol daily and evacuated about 50 million litres.
With the importation of 60 million litres daily and an under-recovery of N25 per litre, the corporation should be currently spending about N1.5bn every day subsidising petrol.
Baru, however, explained that the amount incurred as under-recovery often fluctuated with the international price of crude oil, adding that the higher the cost of crude, the higher the corporation spent on petrol subsidy, and vice versa.
He said, “On December 24, 2017, we were quite in very bad shape as far as fuel distribution was concerned. We had witnessed significant hoarding and diversion of products and most of the filling stations were not having fuel. But I’ve come out with my team to assess the situation myself and for the President that fuel distribution and supply is no longer an issue.
“Despite the huge disparity between the landed cost of petrol and its pump price, the President has been able to ensure that every Nigerian has access to sufficient product at the government regulated price of N145 per litre.”
The GMD added, “This is also despite the fact that at some point, we imported PMS with under-recoveries of over N80 per litre. The President has supported us and told us to go ahead and ensure that products are available to Nigerians and even as of today, the under-recovery is in the region of N20 to N25 a litre.
“And the President is determined that the N145 per litre price should be maintained. But what is most important is the absence of fuel queues. We’ve seen that all the filling stations we passed had sufficient product and were dispensing.”