OFFICE OF THE VICE PRESIDENT: THE FUEL PRICING DEBATE: OUR STORY

Fellow Citizens:
I have read the various observations about the fuel pricing regime and the attendant issues generated. All certainly have strong points.

The most important issue of course is how to shield the poor from the worst effects of the policy. I will hopefully address that in another note.

Permit me an explanation of the policy. First, the real issue is not a removal of subsidy. At $40 a barrel there isn't much of a subsidy to remove.

In any event, the President is probably one of the most convinced pro-subsidy advocates.

What happened is as follows: our local consumption of fuel is almost entirely imported. The NNPC exchanges crude from its joint venture share to provide about 50% of local fuel consumption. The remaining 50% is imported by major and independent marketers.

These marketers up until three months ago sourced their foreign exchange from the Central Bank of Nigeria at the official rate. However, since late last year, independent marketers have brought in little or no fuel because they have been unable to get foreign exchange from the CBN. The CBN simply did not have enough. (In April, oil earnings dipped to $550 million. The amount required for fuel importation alone is about $225million!) .

Meanwhile, NNPC tried to cover the 50% shortfall by dedicating more export crude for domestic consumption. Besides the short term depletion of the Federation Account, which is where the FG and States are paid from, and further cash-call debts pilling up, NNPC also lacked the capacity to distribute 100% of local consumption around the country. Previously, they were responsible for only about 50%. (Partly the reason for the lingering scarcity).

We realised that we were left with only one option. This was to allow independent marketers and any Nigerian entity to source their own foreign exchange and import fuel. We expect that foreign exchange will be sourced at an average of about N285 to the dollar, (current interbank rate). They would then be restricted to selling at a price between N135 and N145 per litre.

We expect that with competition, more private refineries, and NNPC refineries working at full capacity, prices will drop considerably. Our target is that by Q4 2018 we should be producing 70% of our fuel needs locally. At the moment even if all the refineries are working optimally they will produce just about 40% of our domestic fuel needs.

You will notice that I have not mentioned other details of the PPRA cost template. I wanted to focus on the cost component largely responsible for the substantial rise, namely foreign exchange. This is therefore not a subsidy removal issue but a foreign exchange problem, in the face of dwindling earnings.

TippyTop:
Who still listens to this fake pastor?

YourMrBoo:
This osibanjo is the worst fool of a vice president ever come to my memory...

Someone help me ask the fool why government should shy away from their responsibility.

Why can't the government endure by subsidizing our fuel until when we attain the said sufficiency by 2018.

Why will it have to be the masses that will do the enduring, what now is the responsibility of the government if they keep running away from their misgivings and problems.

The government should know that this subsidy removal came at a very wrong time when we are having crisis oon our foreign exchange...

This government is a flop, a joke and a scam...
I despise this government for despising on me first...

Zombies can go ahead and quote me, some of you will have to cough out the said money from your asses to buy the said fuel. Beautiful nonsense

YourMrBoo:
This osibanjo is the worst fool of a vice president ever come to my memory...

Someone help me ask the fool why government should shy away from their responsibility.

Why can't the government endure by subsidizing our fuel until when we attain the said sufficiency by 2018.

Why will it have to be the masses that will do the enduring, what now is the responsibility of the government if they keep running away from their misgivings and problems.

The government should know that this subsidy removal came at a very wrong time when we are having crisis oon our foreign exchange...

This government is a flop, a joke and a scam...
I despise this government for despising on me first...

Zombies can go ahead and quote me, some of you will have to cough out the said money from your asses to buy the said fuel. Beautiful nonsense

Stalwert:
[s][/s]

words of a jealous man

OKDnigeria:
l fully support d govt as far as subsidy removal is concern.

My grouse with dem is their stinking hypocrisy. They opposed it in 2012, telling d pple dat subsidy removal is anti pple. We would have gone past dis issue as a nation 4 yrs ago. APC have set us back by 4 yrs by opposing subsidy removal in 2012. not dat they didn't know d benefit of it, they just wanted to turn d pple against d govt then just to grab power.

YourMrBoo:


Jealous as in how??

In my profession I do it well, am a programmer...

So I expect him to also do well in his, what's there??

Dude how do you charge the phone you are using to quote me zombifically?

passionate88:
MUMU pastor commissioner