Pegs petrol price at N360/400 after removal
The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) yesterday declared that it is in support of the impending removal of subsidy on petrol by the Federal Government.
Speaking with newsmen at the meeting of its National Executive Council meeting in Abuja, PENGASSANs President, Comrade Festus Osifo said the Federal Government can go ahead to remove subsidy, although there is still lack of capacity for local refining.
According to Osifo, since crude oil, which constitutes about 90% of the product cost of petrol, is sold at international price, the difference between imported and locally refined petrol will be negligible.
He added that PENGASSAN has been insisting on making the local refineries functional before removal of subsidy not because it believes that the price of the product will be lower when refined locally.
Rather, he said Union believes that pumping-up the local refining capacity will result in creation of jobs from the value-chain.
Osifo, however, dismissed claims that petrol price will jump up to N750 per litre if subsidy is removed. Asked what the price per litre of petrol should be after the removal of subsidy, Osifo said, Today, the sole importer of PMS into Nigeria is the NNPC. The NNPC is using an exchange rate of the CBN which gives about N400 to N450 depending on the day and depending on the window that you are looking at. So, if you compute that into the model today, PMS should be selling for a region of about N360 to N400.
According to him, the calculation was based on a black market exchange rate.
A litre of petrol is currently sold at N184 at some parts of the country and slightly higher than that in other regions, even as fuel scarcity and long queues gradually subside in most cities.
However, Osifo said that the association has compelled all its organs nationwide to make fuel available for Nigerians and threatened to withdraw the licenses of any member found wanting of hoarding petrol.
He further advised that funds realised from subsidy removal could be invested on infrastructure such as roads or even spend on settling the university lecturers to prevent them from incessant strike.
