There is no plan to increase the pump price of petrol in the country, Minister of State for Petroleum, Ibe Kachikwu has declared.
The minister’s declaration was in response to the news making the round that the pump price might be increased from N145.00 per litre.
The minister, in a statement issued by the Director of Press in the Ministry of Petroleum Resources, Idang Alibi, said his submissions on Thursday during the public hearing by the National Assembly over the fuel crisis never meant that there would be price increase.
The statement reads in part: “The Ministry of Petroleum Resources would like to categorically state that the Honourable Minister never mentioned nor insinuated the need or plans by the Federal Government to increase the current pump price of Premium Motor Spirit (PMS).”
Alibi, in the statement, urged members of the public to disregard any report that there would be a price increase.
He said rather, the minister stated that the Presidency had put in place, a special committee to identify the immediate and remote causes of the fuel crisis.
That, he said, was with a view to finding a lasting solution to the problem.
He said the committee which had been functioning had not concluded its work.
“The committee has been in rounds of deliberations in the past few days and these discussions are still ongoing. The final decisions and recommendations from the committee would be passed on to the President and Commander-In-Chief for approval,” Alibi said.
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During the probe session by the joint committee of the National Assembly on Petroleum Downstream, on Thursday, the minister disclosed that the Nigerian National Petroleum Corporation, NNPC, had incurred a cumulative loss of N85.5 billion in importing petrol and selling at the current retail price of N145 per litre, since October 2017.
He said that was because the price of the product was fixed in the first quarter of 2016, when crude oil was selling for $49.
He said with crude price rising to $67 a barrel, the pump price might not be sustainable any longer.
He explained that the landing cost of PMS had increased to N171 per litre as opposed to the original N133.28 per litre in 2016.
As a result of the increase, he said, independent marketers stopped importation of the product, thus making the NNPC to be the sole importer of the product.
He said because of the increase in the landing cost and the continued sale of the product at the pump price of N145, NNPC incurred a daily loss of about N900 million.
That, he said, in three months amounted to about N85.5 billion.
The minister said it was in a bid to find a solution to the problem on ground that the government set up a committee on how to survive the tide pending when the nation’s refineries would become functional in 18 months time.
In view of this, he said three solutions were being considered.
His words: “One is for the Central Bank of Nigeria (CBN) to allow the marketers access forex at the rate of N204 to a dollar as against the official rate of N305 to keep the pump price of fuel per litre at N145.
“Two, to give room for modulated deregulation where NNPC would be allowed to continue selling at N145 per litre in all its mega stations across the country while the independent marketers should be allowed to sell at whatever price is profitable to them in all their outlets.
“Three, to look at the direction of blanket subsidy for all the importers in bridging the gap which would be like going back to a problem that had earlier been solved.“
The final solution to the fuel crisis, he said however, was to make the local refineries work well to, at least, produce 80 per cent of local consumption of the product.
