The landing cost of Premium Motor Spirit, otherwise known as petrol, was put at N119.66 per litre as of Tuesday, up from N75.15 on January 23.

It increased by N1.07 from N118.59 per litre on Monday, according to data obtained from the Petroleum Products Pricing Regulatory Agency.

The daily subsidy on petrol, therefore, rose to an eight-month high of N48.15 per litre on Tuesday, compared to N3.64 on January 23, the agency’s pricing template showed.

Nigeria, which relies on importation for most of its fuel needs as the country’s refineries are in a poor state, has seen a drop in importation of refined petroleum products in recent months, leading to acute scarcity of the products across the country.

Major oil marketers said on Wednesday that they had yet to resume importation of petrol due to financial constraints occasioned by the delay in the payment of subsidy arrears to them by the Federal Government.

The Executive Secretary, Major Oil Marketers Association of Nigeria, Mr. Obafemi Olawore, told our correspondent in a telephone interview, “We don’t have money to import. We have been relying on NNPC products.

“At the moment, what we are loading is from the NNPC, and we (major marketers) sell at the government recommended price. I don’t know of other marketers.”

Subsidy refers to the money paid, usually by the government, to keep prices below what they will otherwise be in a free market system.

The global benchmark Brent crude lost almost half of its value between June 2014 and January this year, plunging below $50 per barrel, but has rebounded in recent months. It traded around $64 per barrel on Wednesday.

The landing cost of petrol was put at N75.15 per litre on January 23, almost a week after the Federal Government reduced the pump price of the product by N10 per litre.

An energy expert and Senior Lecturer, Energy Law at the University of Lagos, Dr. Adedayo Ayoade, told our correspondent that there were questions to be raised as regards the sudden increase in the landing cost of the product.

“I am not aware of any spike in the price of crude oil that could have led to such an increase in the landing cost of petrol,” he added.

The landing cost is the sum of the product cost plus freight rate at N107.66; trader’s margin, N1.47; lightering expenses, N4.19; Nigerian Ports Authority fees, N0.77; financing cost, N1.68; jetty depot throughput charge, N0.8; and storage charge, N3.

The addition of the distribution margins to the landing cost gives the Expected Open Market Price (total cost). The distribution margins, which comprise retailers, transporters and dealers’ profits, as well as bridging fund, marine transport average and admin charges were not stated.

Retailers get N4.6; transporters, N2.99; dealers, N1.75; bridging cost is N5.85; marine transport average, N0.15; and the admin charge, N0.15. The sub-total margin stands at N15.49.

When added to the landing cost of N119.66, the EOMP of N135.15 per litre is arrived at. But this is subsidised and a flat official rate of N87 per litre is given.

The Federal Government had on January 18, 2015 announced the reduction in the pump price of petrol from N97 to N87 per litre, attributing this to the decline in global crude oil prices.

The landing cost of the product was N116.79 per litre on May 21, while the subsidy component was N45.28 per litre, according to the PPPRA.

There have been calls in many quarters on successive governments to fully deregulate the downstream sector of the oil and gas industry to encourage private investments in crude oil refining, as well as the privatisation of the nation’s existing refineries, which are working far below their installed capacities.

http://www.punchng.com/business/business-economy/petrol-subsidy-rises-to-n48-15-per-litre/

Cc: Lalasticlala

This subsidy issue will soon be discovered to be a scam. ...It will definitely be discontinued at the appropriate time....

dunkem21:
..And PMB says there is no subsidy while they are busy wasting our resources on a few cabal ..I miss you, GEJ

You miss Gej for increasing Subsidy fee from 300 billion to 1.3 trillion? Well done o

We bought petrol at 120 per litre inside UNIPORT campus so which subsidy are they talking about?

.....

..And PMB says there is no subsidy while they are busy wasting our resources on a few cabal ..I miss you, GEJ

Those missing GEJ can go meet him in otuoke where MAMA piss is already causing havoc... PMB cant rush into a delicate decision when the nation is just recovering from the shit GEJ left behind... moreover change cannot happen over night, its a gradual process. when its all done we all gonna be proud to call Nigeria our home.

All these nonsense will soon be over.

PMB cannot just announce a discontinuation by fiat. It requires careful study of the situation to take a decision.

Within a month or two, subsidy must end.

PPPRA as a body is just trying to be smart.

They are looking for all means to cover up/ explain the grand scale irregularities they've been allowing/encouraging.

Also,to help their cronies make as much as they can within the time window it will take for this govt to sttle down and finally scrap the burden and looting avenue called subsidy..

They have "accurate" data on the amount of subsidy that is to be paid but none on how much petrol, kerosene the nation consumes on a daily basis, Jokers!

Most of their Directors; present and Ex will have their days in court.

otokx:
We bought petrol at 120 per litre inside UNIPORT campus so which subsidy are they talking about?

120 is fair, it is higher here, even with bad products and meters.
Subsidy has got to stop. The scheme is not serving its expected use, just a means where top guys in the Oil sector feed fat on our commonwealth.
PMB needs to sit down and work out a plan. This just can't continue.

we still have a long way to go in this country.

At a time like this, Buhari needs the wisdom of Solomon

Our Ajalla and his associate are still travelling round,

When the president focused on travelling and seems utterly confused about forming his cabinet and their party APC fighting over senate presidency then we are in for a long term inflation and gradual collapse of the economy.

Who is running this country today?

A totally working system has been corrupted by GEJ and his cronies.
I am afraid, it is actually cheaper to get rid of the subsidy than to try to repair it

Hmm naija

I thought some said ,there was NO subsidy?

Some nairalander deserve to be gunned down

emamos:
Some nairalander deserve to be gunned down

ionsman:
This subsidy issue will soon be discovered to be a scam. ...It will definitely be discontinued at the appropriate time....


You miss Gej for increasing Subsidy fee from 300 billion to 1.3 trillion? Well done o

When will the subsidy be discovered to be a scam? The people that called it a scam and insisted that the pump price be reversed to N67 are paying higher subsidies today than the people that acknowledged it.

..and to think Nigerians went to the street to protest ..

MzJackBaueress:

se na lie, seeing dia comments alone make me angry

Hmmmmnn

Baba

ok

Morning Guys

otokx:
We bought petrol at 120 per litre inside UNIPORT campus so which subsidy are they talking about?

^^^
Don't mind them jare

emamos:
Some nairalander deserve to be gunned down

^^^

Honestly speaking

Hmmm

oduastates:
A totally working system has been corrupted by GEJ and his cronies.
I am afraid, it is actually cheaper to get rid of the subsidy than to try to repair it

Shut the hell up and leave GEJ alone

i thought subsidy is a scam, 9ja and magomago eh, well all i want is fuel to be #60naira, lobatan

The situation is bad, after all the talks last week the queues still persist in Abuja. Can't find diesel anywhere now. Do these people want my business to grind to a halt?

Pls when will we start buying fuel at N45?

We are going to discover soon that APC and BullHarry are all scam!!! I pity some folks shouting 'change'