Many things has been said and heard/read regarding Fuel Subsidy since year 2016 began, here are few highlights.

We have heard so many things regarding Petrol Subsidy and we are still hearing, could it be that these information were wrong, or were they preparing us for the current price?

1. FEDERAL GOVERNMENT OFFICIALLY STOPS PAYMENT OF SUBSIDY ON PETROL: The absence of the usual subsidy component in the latest Petroleum Products Pricing template from the Petroleum Products Pricing Regulatory Agency, PPPRA, has indicated the federal government’s decision to officially stopped paying subsidy on the premium motor spirit, PMS, better known as petrol.
The official pricing template for petrol by the PPPRA as of December 28, 2015 saw the Federal Government subsidising the product by N6.45 per litre when the Estimated Open Market Price, EOMP, at that time was N93.45. This was N6.45 higher than the then retail price of N87 per litre.
The EOMP is the summation of the landing cost of petrol and subtotal margins which include transporter’s cost, dealer’s charge, bridging fund, administrative charge, etc

2. PMS PRICE FALLS AS FG WITHDRAWS SUBSIDY: Following the release of a new pricing template by the government’s agency, Petroleum Products Pricing Regulatory Agency, the price of the Premium Motor Spirit often called petrol, has fallen after the removal of subsidy on fuel.
On the new pricing template by PPPRA which took effect from 1st January, 2016, there was a clear indication that the Federal Government of Nigeria had removed her subsidy on petrol as this act caused wholly changes between the Estimated Open Market Price and the retail price across the country.
As revealed by the Executive Secretary of PPPRA, Farouk Ahmed, these changes have been effected in the EOMP: the Traders’ margin N1.47 per litre to zero; Lightering expenses, from N4.07/litre to N2.00/litre; Charges by the Nigerian Ports Authority (NPA), from N0.77/litre to N0.36/litre; jetty throughput charges, from N0.80/litre to N0.40/litre; storage charge, from N3.00/litre to N1.50/ litre; bridging fund, from N5.85/litre to N4.00/litre; and ex-depot price, from N77.66/litre to N77.00/litre. All these are the downward changes. The upward changes also cut across the Retailers’ margin from N4.60/litre to N5.00/litre; Transporters’ margin, from N2.99/litre to N3.05/litre; and dealers’ margin, from N1.75/litre to N1.95/litre.
Consequently, the FG has authorised the pump price at the retail outlets of the Nigerian National Petroleum Corporation (NNPC), to be fixed at N86 per litre while other retail outlets managed by private oil marketers to sell at N86.50 per litre.

3. SUBSIDY REMOVAL: FG SAVES N18.3BN IN SIX WEEKS: The Federal Government’s savings as a result of the removal of subsidy on both petrol and kerosene are growing daily, OKECHUKWU NNODIM writes
Between January 1 and February 12 this year, an interval of about six weeks, the Federal Government made over N18.3bn as savings from the removal of subsidy on Premium Motor Spirit and House Hold Kerosene.
The government officially stopped subsidy on PMS, popularly known as petrol, on January 1, 2016, while on January 23 this year, it also ended the subsidy regime on kerosene, according to the pricing templates for both commodities obtained from the Petroleum Products Pricing Regulatory Agency. The PPPRA is the agency of the Federal Government that fixes and regulates the prices of the white products, PMS and HHK, as well as other refined petroleum products across the country.
It unveiled its revised PMS template on January 1, 2016 while that of HHK was posted on January 23, a development that showed that the Federal Government now makes extra cash daily from every litre of petrol and kerosene sold across the country.
The PPPRA occasionally updates the templates for both commodities to reflect fluctuations in the global prices of crude oil.
An analysis of the various updated templates so far released by the agency after they were revised showed that the Federal Government had raked in over N18.3bn in six weeks.
For instance, in the recent template for PMS, which was posted on the PPPRA website on February 12, the government made a cash recovery of N15.23 on every litre of petrol sold in the country.
On petrol alone, about six templates had been released by the regulatory agency, beginning with the one posted on January 1 this year, which confirmed the stoppage of petrol subsidy and showed an over recovery of N1.4 per litre of PMS.
Other templates were posted on January 11 and January 20, as well as on February 6 and February 11, while their over recoveries were N4.7, N7.49, N10.5, and N16.06 per litre, respectively.
Therefore, on the average, the over recovery for PMS since January 1 this year is N9.23 per litre.
According to the Nigerian National Petroleum Corporation, about 40 million litres of petrol are being consumed daily in the country.
When multiplied by the average over recovery on the product and the number of days (January 1 to February 12), the result shows that the government must have made extra cash of N15.88bn from the sale of petrol alone since the halt of subsidy on the commodity.

4. FG RESUMES PAYMENT OF PETROL SUBSIDY: Following the rise in crude oil price to about $47 a barrel, the federal government will resume the payment of subsidy on petrol as the product is now selling below the expected open market price, the pricing template of the Petroleum Products Pricing Regulatory Agency (PPPRA) has shown. According to the updated template the agency released in Abuja, which is expected to cover the second quarter of 2016, the expected open market price of petrol has risen to N99.38 per litre for independent and major oil marketers, and N98.62 per litre for retail outlets belonging to the Nigerian National Petroleum Corporation (NNPC).
The expected open market price is the actual price of the product taking into consideration all market elements, which include landing cost and distribution margins, without subsidy element.
However, a source within the PPPRA told LEADERSHIP exclusively last night that the pump price of fuel remains N86.50 for major and independent marketers, and N86 for NNPC retail outlets, adding that the difference would be taken care of through subsidy payment.
The source noted that the subsidy payment would, however, not be at any extra cost or burden to the federal government, explaining that it would be funded from the savings made during the first quarter (Q1) when the market was over-recovering, that is, selling above expected open market price due to low oil price.
Minister of state for petroleum resources, Dr. Ibe Kachkwu, had disclosed that about N100 billion had been saved from over-recovery, saying the fund would be saved and used to offset differentials when the market begins to under-recover as part of the price modulation mechanism put in place by government.
Consequently, at the current price of N86.50 per litre for major and independent marketers, and N86 per litre at NNPC retail outlets, the federal government will be paying N12.88 and N12.62 per litre of petrol respectively as subsidy.

5. FG SUBSIDISING PETROL BY N12 – PPPRA: The Federal Government on Monday said it was currently subsidising Premium Motor Spirit (PMS) otherwise known as petrol at N12.62 per litre.
It said that the subsidy figure was for petrol imported directly by the Nigerian National Petroleum Corporation (NNPC) and dispensed at its retail outlets, while the rate was N12.88 per litre for other oil marketers.
This was contained in the latest Petroleum Product Pricing Regulatory Agency (PPPRA) Template released in Abuja.
It said that although provision was not made for subsidy in the 2016 budget, it would be defrayed from “recoveries” made by the country from oil transactions in the first quarter of 2016.
According to the agency, between January and March, 2016, the Federal Government was able to save about N10 billion as a result of selling the product above the Expected Open Market Price.
It explained that without the subsidy and given the landing cost of the product, it ought to be sold at N98.62 per litre at NNPC outlets and at N99.38 per litre by major and independent oil marketers.
According to the template, the expected open market price is the actual price of the product without subsidy and it was based on the current exchange rate of N197 to a dollar.
A breakdown of the template revealed that for NNPC retail outlets and independent and major oil marketers, landing cost of PMS imported into the country was N84.32 and N85.08 per litre, respectively.
It stated that the distribution margin, which included retailers, transportation, bridging fund and dealers margin stood at N14.30 for both NNPC and other marketers.
“This brings the current Expected Open Market Price to N98.62 and N99.38 for NNPC retail outlets and other marketers respectively,” it said

6. FG REMOVES SUBSIDY, PETROL TO SELL FOR N145 PER LITRE: The Federal Government has finally removed subsidy from sale of Premium Motor Spirit, PMS, also known as petrol with immediate effect.
NNPC sources this afternoon said marketers are now free to bring in cargoes and sell, subject to meeting standard quality control.
It however added that a benchmark of N145 per litre, as a recommended pump price, at which any trader, irrespective of the source of foreign exchange used to import cargo is guaranteed adequate profit.

APC Told so much lies, they told us one time that they were no longer paying subsidies.how come they started paying, stopped paying again and the price went up to N145.

Buhari is not a man of integrity

This is a government of #NO-ONE-IS-SURE-OF-WHAT-IS-HAPPENING.

Even the leaders are not sure.

"Cluelessness" in display.

Confused government!

Nice compilation... I have decided to refrain from commenting on this subsidy removal issue. Just look at the complication of lies we Nigerians have been told and someone will come on here to defend the action of d Government. First if you are seeking a competitive market for PMS, why the price ceiling? All marketers can come together n decide not to sell below 145 for the next 2 years and there's nothing no one can do since there is already a fixed price ceiling. This Government finally displayed their insensitivity to the plight of Nigerians.

TPAND:
APC Told so much lies, they told us one time that they were no longer paying subsidies.how come they started paying, stopped paying again and the price went up to N145.

Buhari is not a man of integrity

So what exactly is a lie in all 6 statements? Foreign exchange became so scarce owing to many factors that Government cannot provide enough Dollars for importation. The new price is based on parallel market.

Abagworo:


So what exactly is a lie in all 6 statements? Foreign exchange became so scarce owing to many factors that Government cannot provide enough Dollars for importation. The new price is based on parallel market.

Ooo thou gullible... When will thou begin to use thy cerebrum