Maybe I missed the news either from Jonathan , Okonjo, Sanusi or Labaran maku

Has anyone cared to explain to us how subsidy went from 300b to 1.3trillion

The cost of something cant just increase times 4 without any explanation

was it that fuel consumption quadrupled or oil Prices quadrupled.

What are the multipliers that made Subsidy = X become Subsidy = 4X?

They tried to explain, but i don't think anybody will be able to understand coz it is magical.

This is one post by alj harem in another thread here and i think its brilliant

Anybody who speaks up against this policy of subsidy removal will immediately be called an agent of "oil cabals", "agent of Boko Haram", "agent of IBB, Atiku, Ciroma" etc, by Jonathan apologists on this blog.
You people should answer these questions and I will be one of your members:


Why was Obasanjo able to pay off our national debt worth billions of dollars while retaining fuel subsidy?
Why was Obasanjo able to build up our foreign reserves into billions of dollars while subsidy was still on?
Why did Obasanjo still launch some projects, like satellite, while subsidy was on?
Why was subsidy money in the billions while others were in government but went into trillions just few months into Jonathan`s government?
Why were the implicated subsidy beneficiaries(oil cabals) not punished by Jonathan?
Let me stop here. Answer these questions satisfactorily and I will join you in canvassing support fr subsidy removal.

Still waiting for any explanation

Iweala did explain on AIT yesterday. Can't type much now but the following are all part of the equation:

1. Increased domestic demand for transportation (Commensurate with increase in number of imported / new cars within the period)
2. Increased consumption for powering generators (Also commensurate with generator imports)
3. Increase in oil price leading to increased price of petroleum products. Note that price was kept constant at N65 all through.
4. Exchange rate factors.
5. Pseudo-demand due to smuggling / other corrupt practices.

She didn't give figures anyway. If only we can see the figures and do the calculation ourselves, we can really see how the "blame" should be shared.

One of the greatest problems is our inability to quantify our actual market size (i.e demand).

By the way, I'm no govt official. I just regurgitated what madam said and garnished it with my own knowledge.

diluminati:

This is one post by alj harem in another thread here and i think its brilliant

May be this she goat was referring to this

https://www.nairaland.com/nigeria/topic-841572.128.html#msg9945167

efisher:

Iweala did explain on AIT yesterday. Can't type much now but the following are all part of the equation:

1. Increased domestic demand for transportation (Commensurate with increase in number of imported / new cars within the period)
2. Increased consumption for powering generators (Also commensurate with generator imports)
3. Increase in oil price leading to increased price of petroleum products. Note that price was kept constant at N65 all through.
4. Exchange rate factors.

And for the ten years prior, during which the cost of the subsidy regime remained below 300 billion, none of these factors existed? Get real.

All of these factors suddenly began to exist in 2011 only and led to a 1 trillion increase in the cost to 1.3 trillion? Get real.

Some of these excuses are quite insulting even to the intelligence of a five year old.

OP you wan kill them ni. All they know how to do is steal. They are not very good at analyzing anything or keeping records.

300 Billion was a while ago.
We import upwards of 300,000 cars into this country every year. That means in 4 years we would be talking something like 1.2million cars.
We import even much more generators and with the influx of cheap Chinese brands, almost every family now owns a generator.

Add that to the doubling of fuel price/barrel and the devaluation of our currency from from N120/$.

The increase isn't too much out of place but its pretty obvious as well that much of that goes to smuggling and over-inviocing.

Papa

You are being deceitful, how many cars are on the roads at a time and how come it jumped up in 2011 and not the other years, abeg bone that thing jare, even when crude oil was far more than this, the subsidy was still stable.

efisher:

Iweala did explain on AIT yesterday. Can't type much now but the following are all part of the equation:

1. Increased domestic demand for transportation (Commensurate with increase in number of imported / new cars within the period)
2. Increased consumption for powering generators (Also commensurate with generator imports)
3. Increase in oil price leading to increased price of petroleum products. Note that price was kept constant at N65 all through.
4. Exchange rate factors.
5. Pseudo-demand due to smuggling / other corrupt practices.

She didn't give figures anyway. If only we can see the figures and do the calculation ourselves, we can really see how the "blame" should be shared.

One of the greatest problems is our inability to quantify our actual market size (i.e demand).

By the way, I'm no govt official. I just regurgitated what madam said and garnished it with my own knowledge.

This is by far the most idiotic post I've ever read on this site. God Damn.

Exchange rate factors? For the 4x boom of Oil Subsidy?

What a clown.

Im convinced they looted to refinance rigging GEJ in.

Update: Sen Oluremi Tinubu n Sen Gbenga Ashafa 's cars were smashed during the attack this evening in #Ibadan #occupyNigeria. They were slapped and well beaten

I'm not interested in making any excuses and I will appreciate if people with analytical minds can come into this thread and do justice also. As you've noticed, smuggling / corruption is included in my list.
Going forward, let's look at the case of cars imports for example. Recall GEJ relaxed the age limit for importing cars. That must have had a direct impact on number of cars getting into the country. Imagine how many people bought up "fuel guzzlers" that were being dumped cheaply in the US. Last year alone, I got 2 SUVs for myself. For a quick check, go to autos section here on nairaland and study how people have bought more SUVs / gasoline trucks et al from the dealers there. Maybe we can even ask people like inspired to give us an idea in terms of % increase in sales for 2011. (Indicating % increase in SUV sales) etc.

One more thing in addition to all I have listed earlier. The absence of queues from our filling stations all year round without much efforts put into plugging the borders coupled with the increase in number of importers points to the fact that FG tried to flood the market to prevent scarcity. That's another factor too.

Pls remember, I'm not interested in justifying the increase. I am only playing the role of an analyst with limited info within my reach.

Thanks

but under johnie, they claimed to have achieved the highest MW ever generated by the ministry of power so why was there's greater demand for generator?

isnt the main reason why we are importing millions of car, the FG and NASS member with their annual budget for cars?

As always, posters who have nothing to offer are very good at insulting. That's why I like posters like aletheia, ekt-bear, danjohn, etc
in issues like this. Hurling insults in response to facts and figures is simply immature.

there are many reasons for this. but what is important to me, is that,

OBJ spent 300B on subsidy. result is fuel scarcity every 2 weeks. (you all cursed him for it)
GEJ spent 1.3T on subsidy. result is no scarcity for almost two years. (you all praised him for it)

we always see half facts

https://www.nairaland.com/nigeria/topic-844042.64.html#msg9945239

You might find your answer here

Trust NLers they will explain what the experts have tactically dodged. Some silly factors were presented by some posters. My question is this.
Has the number of cars doubled or just increased within the few months in question?
Has the exchange rate differential declined by a factor of two or just marginally deteorate?
Has the number of nigerians doubled in the few months or just marginally increased?
Has there been a 100% change in crude price of crude in any direction since GEJ compared to previous admins?

If non of the above happened to double in the FEW MONTHS in question, WHY HAS THE SUBSIDY MONEY MORE THAN QUADRUPLE IN THOSE FEW MONTHS?

simple: corruption [font=Lucida Sans Unicode][/font]1000

efisher:

Iweala did explain on AIT yesterday. Can't type much now but the following are all part of the equation:

1. Increased domestic demand for transportation (Commensurate with increase in number of imported / new cars within the period)
2. Increased consumption for powering generators (Also commensurate with generator imports)
3. Increase in oil price leading to increased price of petroleum products. Note that price was kept constant at N65 all through.
4. Exchange rate factors.
5. Pseudo-demand due to smuggling / other corrupt practices.

She didn't give figures anyway. If only we can see the figures and do the calculation ourselves, we can really see how the "blame" should be shared.

One of the greatest problems is our inability to quantify our actual market size (i.e demand).

By the way, I'm no govt official. I just regurgitated what madam said and garnished it with my own knowledge.

If you watched Falana on channels tv this afternoon, you will understand why it went from 300B to 1.3T. The document presented to the senate by PPPRA disproves all your 5 reasons. The cost of subsidy never went up above 300B. Not till last senate meeting at least.
Having said that, do you honestly look at your above 5 reasons and think it warrants a 4 fold increase. Just search your soul before you post a reply.

@Dis guy, that's a valid concern too but let's point the searchlight on the power sector also.

1. Population has increased leading to direct increase in energy need.
2. Increase in "MW" most likely did not meet up with the increase in power demand.
3. More appliances, more businesses, greater awareness, more wealthy individuals etc all contribute to an increase in energy demand and ability to meet it.
4. More generators imported as mentioned earlier.

Population increased from 150 to 167 , so did the foreign exchange. Any correlation? At least those 17million born cannot drive cars yet or buy gen.

efisher:

I'm not interested in making any excuses and I will appreciate if people with analytical minds can come into this thread and do justice also. As you've noticed, smuggling / corruption is included in my list.
Going forward, let's look at the case of cars imports for example. Recall GEJ relaxed the age limit for importing cars. That must have had a direct impact on number of cars getting into the country. Imagine how many people bought up "fuel guzzlers" that were being dumped cheaply in the US. Last year alone, I got 2 SUVs for myself. For a quick check, go to autos section here on nairaland and study how people have bought more SUVs / gasoline trucks et al from the dealers there. Maybe we can even ask people like inspired to give us an idea in terms of % increase in sales for 2011. (Indicating % increase in SUV sales) etc.

One more thing in addition to all I have listed earlier. The absence of queues from our filling stations all year round without much efforts put into plugging the borders coupled with the increase in number of importers points to the fact that FG tried to flood the market to prevent scarcity. That's another factor too.

Pls remember, I'm not interested in justifying the increase. I am only playing the role of an analyst with limited info within my reach.

Thanks

You still don't get it bro. I'll simplify it.

ALL of the factors that you mentioned above have always existed year on year - in all the years in the decade preceding 2011. And yet NONE of those years witnessed a jump of the nature witnessed in 2011 - 300 billion to 1 trillion.

What this means that you have to point to a factor unique to 2011 to account for the unprecedented and unique jump. You cannot point to factors which have existed in every year - but which did not have a similar effect in ANY other year.

What was unique to 2011? I say a highly tense presidential election. What say you?

Please answer the simplified arguments on the subsidy issue proferred here -

https://www.nairaland.com/nigeria/topic-843824.0.html

So many questions, so few answers.

Anyway, it's cheering to note that Nigerians are breaking free from the hypnotism to which their thieving leaders have subjected them for decades.

I encourage the people to continue to ask more probing and searching questions. Embarrass them with questions!

There's no sitting on the fence.

Funny theories.Even Madam can't explain the increase.It all boils down to corruption.

efisher:

I'm not interested in making any excuses and I will appreciate if people with analytical minds can come into this thread and do justice also. As you've noticed, smuggling / corruption is included in my list.
Going forward, let's look at the case of cars imports for example. Recall GEJ relaxed the age limit for importing cars. That must have had a direct impact on number of cars getting into the country. Imagine how many people bought up "fuel guzzlers" that were being dumped cheaply in the US. Last year alone, I got 2 SUVs for myself. For a quick check, go to autos section here on nairaland and study how people have bought more SUVs / gasoline trucks et al from the dealers there. Maybe we can even ask people like inspired to give us an idea in terms of % increase in sales for 2011. (Indicating % increase in SUV sales) etc.

One more thing in addition to all I have listed earlier. The absence of queues from our filling stations all year round without much efforts put into plugging the borders coupled with the increase in number of importers points to the fact that FG tried to flood the market to prevent scarcity. That's another factor too.

Pls remember, I'm not interested in justifying the increase. I am only playing the role of an analyst with limited info within my reach.

Thanks

Yes that's true but if you have two cars, you can't drive both at the same time, so your fuel consumption remains relatively the same. And you have not taken into account the number of cars written off in accidents.

ade_77:


Yes that's true but if you have two cars, you can't drive both at the same time, so your fuel consumption remains relatively the same. And you have not taken into account the number of cars written off in accidents.

Of which accidents happen like water in naija.

Back to the main issue. WHy the hullabaloo about the fuel subsidy and the subsequent decision to remove it? simple, because it suddenly went up to N1.6trillion naira. In 2009 & 2010 it averaged N270billion, or thereabout. So why the 500% increase in a year?
First, a few facts.
Between January 2011 and March 2011, FG paid an average of N22billion monthly as subsidy. At that rate, we would have paid around N264billion (which was close to the N240billion budget signed by the National Assembly). However, something happened afterwards. From April 2011, subsidy increased to over N100billion monthly and stayed that way until the end of the year. Don't forget, April was the mont of the elections. This is what we need to look into.
The funny thing, and i shudder as i think of this, is that there might be no cabal afterall. And even if they exist, they are not the ones who submitted the 2012 budget proposal to the National Assembly last December. The didn't propose a billion naira for feeding in the presidency. The didnt propose N300k for desktop computers etc.
In any case, Nigerians didn't vote for the so called CABALS. These blame-game by the Jonathan regime must stop

so FG reduce the age of cars in December 2010/january2011 and gbam the demand quadruple?? haba the cost of clearing older cars is almost equivalent to 10yr cars

efisher:

@Dis guy, that's a valid concern too but let's point the searchlight on the power sector also.

1. Population has increased leading to direct increase in energy need.
2. Increase in "MW" most likely did not meet up with the increase in power demand.
3. More appliances, more businesses, greater awareness, more wealthy individuals etc all contribute to an increase in energy demand and ability to meet it.
4. More generators imported as mentioned earlier.

lol since the day youve gotten your brownie point about contributing to the power sector document, youve been drinking something  

more weathy individuals? in the period when madam okereke, madam ibru dem  crashed the stock market yakata,

when sanusi turned the heat on the pastor bankers, and squeezed some rich individuals to pay up their debt


which weathly individual are you talking about? Jonathans MEND security personnel or Dame goodlucks family members?

whats the unemployement figures again?

efisher:

Iweala did explain on AIT yesterday. Can't type much now but the following are all part of the equation:

1. Increased domestic demand for transportation (Commensurate with increase in number of imported / new cars within the period)
2. Increased consumption for powering generators (Also commensurate with generator imports)
3. Increase in oil price leading to increased price of petroleum products. Note that price was kept constant at N65 all through.
4. Exchange rate factors.
5. Pseudo-demand due to smuggling / other corrupt practices.

She didn't give figures anyway. If only we can see the figures and do the calculation ourselves, we can really see how the "blame" should be shared.

One of the greatest problems is our inability to quantify our actual market size (i.e demand).

By the way, I'm no govt official. I just regurgitated what madam said and garnished it with my own knowledge.

E fisher now lets analyse

Which of these factors just came into play in 2011 that jumped the cost?

What made cars and generators to increase astronomically in 2011?

In 2010 average oil prices was around $80/barrel in 2011 it was around $90/barrel

What would increased demands for cars in Nigeria astronomically? Increased wages Yes. I know around 1999-2000 when minimum wage was increased number of cars increased but since then no increase yet . The 18k hasnt even been implemented so it cant be a reason and what are the Road safety stats that showed such astronomical increase in number of cars

Exchange rate factors? You mean there were no exchange rate factors in the previous years and Smuggling just started in 2011?