The Minister of State for Petroleum, Ibe Kachikwu and state governors prevailed on President Muhammadu Buhari to hike fuel price from N86.50 to N145 per litre, a top government official told journalists in Abuja last night.

The official, who pleaded anonymity, said Buhari, who was concerned about the effect of fuel price hike on the average Nigerian, had strongly resisted the proposal by Kachikwu for several months but “succumbed reluctantly this month when he (Buhari) was presented with the stark reality of the dropping oil earnings and foreign reserves situation.”


The official said apart from this, “pressure from state governors whose allocation from FAAC has been dropping was also a significant factor that swayed the president.”
He said Buhari would not have agreed to the new fuel pricing regime if he had not been presented with the compelling evidence that Nigeria’s declining foreign earnings from oil would be further devastated unless independent oil marketers and other interested entities are encouraged to import fuel.
He said: “The amount required for fuel importation alone will easily take about more than half of the $550m foreign earnings. If the country continues doing that the oil revenue left for FAAC sharing would be significantly reduced with the possibility that a situation where there would be nothing left to share between federal government, states and local governments exists in the near future.
“Although NNPC is meant to supply only 50 per cent of the local fuel supply and independent marketers making up the balance, none of the marketers has been able to source forex from the CBN this year and therefore cannot sell at the prevailing price regime and make a profit. If the federal government continues with NNPC alone importing oil, and trying to fill the gap left by the independent marketers by dedicating more export crude for domestic consumption, the depleting impact on the oil earnings would continue to worsen. And when this is added to the fact that already about 27 states cannot pay salaries because of the dwindling foreign earnings, the situation becomes even worse. Even some oil producing states like Bayelsa are affected,” he said.
He added: “With the drastic reduction in the foreign earnings in April, what would be shared at the next FAAC is expected to be the least ever, when the meagre $550m oil earnings are converted to Naira. The sharp reduction in government revenue particularly from oil earnings due to low price regime in the international market has been exacerbated by domestic factors such as recent sabotage by disgruntled and faceless militants in the Niger Delta”.

http://www.dailytrust.com.ng/news/general/kachikwu-governors-forced-buhari-to-hike-fuel-price--fg-official/146750.html#sea4Uq7VXjwMq2Mp.99

@ Gun Point

It all for their selfish interest,they don't care about the common man.

Chai dullard na dullard.

I am so sure Rauf Aregbesola lead the Governors to prevail on PMB to do that.

That is not an excuse.

State governors forcing a sitting president just for them to get more money to lavish, really Nigerians are in one one chance. But Is like kachuku is the new lai muhammed of this government

Some people are in the habit of spewing far fetched news. What has fuel hike got to do with State Govs..

dollyjoy:
It all for their selfish interest,they don't care about the common man.

Can you read and do you prepare a budget for your household even if you don't understand economics?

This guy don join them

Irrespective of whatever went behind our backs, it was the right decision. And for the president to have succumbed, it means he was convinced. I trust him that much because I know he's not an IB.

The next thing is to provide palliatives and increase minimum wage to at least 40k.

Robbing peter(oil cabal) to pay paul (govornors) just so that they can continue to live flamboyant and expensive lifestyles.What did some state governors do with their bailout?

Buhari is always looking for who to blame and never willing to assume and accept responsibility.

Ibe Kachikwu is nervous and the state governors that joined him to prevail on Buhari to hike fuel price to N145 per litre, are reckless and unreasonable. It is the importation of Fuel of 50% for Domestic Consumption that put us in this mess.
If Buhari, is truly concerned about the effect of fuel price hike on the average Nigerian, he should immediately stop all importation of Fuel for Domestic Consumption and compel NNPC to produce 100% Domestic Fuel Consumption. While the subsidies removal is sustained, the price hike should be dethroned to N100.

We are really in big mess in this country i wonder why states government always wait for federal allocation before they could pay their workers please what is functionality of States government? for me state government is now a useless in Nigeria no portable water bad roads lack of quality eduction . we are always focus our attention on federal govt challenge federal govt all the time as if we do not have governor in our respective state?

Like i said,subsidy did not exist this year ,it was just a forex and revenue problem

DropShot:
Irrespective of whatever went behind our backs, it was the right decision. And for the president to have succumbed, it means he was convinced. I trust him that much because I know he's not an IB.

The next thing is to provide palliatives and increase minimum wage to at least 40k.

There they go again! Putting the cart before the horse. Remove subsidy first, create pandemonium and hardship in the polity, issue some threats in a strong language and then go to the drawing table to draw up palliatives for test running. Hmmmmm...this has vindicated the Chief Navigator - Buhari is not sound in economics and foreing matters.

You mean Buhari lost control to Kachukwu?

Buhari has been a clueless leader right from the early eighties. Zombies note that wailers form are no longer available

Which kind mumu government be this? Always looking for who to put the blame on.

Imagine a seating president blaming his subordinates for his own actions.tufiakwa!

It doesn't exempt the president from responsibility for the action of his government. The buck stops at his table. As it stands, he has consciously unleashed untold hardship on Nigerians and that's all there is to it.

There is a difference between removal of fuel subsidy and price hike. FG did not hike price it only removed subsidy, we should expect that the forces of demand and supply will eventually stabilize the price.

Kineticist:
Some people are in the habit of spewing far fetched news. What has fuel hike got to do with State Govs..

It means saving got frm removal of subsidy will improve d state dwindling allocation, got it now

The same way state governors forced GEJ to share the money in ECA.

So Buhari also does not have the political will to stand the state governors.

They should also force him to resign, since he does not know what he is doing.

I am suprised it's not Gej or Okonjo iweala that is blamed.Soon Emefiele will and minsters will force him to devalue naira.

Do we really have a president how can governors Buhari have respect of force him to increase fuel price
This is the result when the private Fulani president will not hold meetings with his ministers, each ministers just say anything they like on air

otukpo:
The same way state governors forced GEJ to share the money in ECA.

So Buhari also does not have the political will to stand the state governors.

And you call gej clueless for taking such action
What will you call Buhari now?

This gang of Governors have always been behind the depletion of our national treasury. We shall see what their end will be.

Another President that can be "forced" ?

Maybe We need Mama Peace to block them....Thuggery is a bonafide profession and she can do it very well if hired with enough incentives.