THE Federal Government’s decision to initiate a 13.8 per cent decrease on the retail pump price of petrol nationwide from N145 to N125, was based on drop in Nigeria’s Expected Open Market Price, EOMP, rather than subsidy removal, an official of the the Petroleum Products Pricing Regulatory Agency, PPPRA, has explained.

Abdulkadir Saidu, Executive Secretary of the PPPRA, said the global demand for crude oil which dropped by $25 per barrel on Wednesday resulted in a 30 per cent drop in the EOMP of petrol below the initially approved retail pump price cap of N145 per litre.

“The directive of Government to the NNPC to reduce the Ex-Coastal price of PMS, despite the fact that the current stock of product was imported during the months of January and February, 2020 is highly commendable, although this action is not without costs to the Corporation,” he said.

The new price template of N125 was based on the approved distribution margins of petrol of which the breakdown is as follows, Ex-Coastal price (consisting cost and freight charges) set at N99.44 per litre and the new EOMP pegged at N118.81.

The average EOMP for the months of January and February 2020 was N175.52 per litre and N156.02 per litre respectively shows that subsidy paid on petrol by the Federal Government was N30.52 and N11.02 per litre respectively for two months.

Mele Kyari, NNPC GMD, in a statement said the decision to review the ex-coastal, ex-depot and NNPC retail pump price was in compliance with the directives by the Minister of State for Petroleum Resources, Timipreye Sylva, on PMS pricing.

“Effective March 19, 2020, NNPC Ex-Coastal price for PMS has been reviewed downwards from N117.6 per litre to N99.44 per litre, while Ex-Depot price is reduced from N133.28 per litre to N113.28 per litre,” Kyari said.

PPPRA template shows that with the review of the ex-depot price of the commodity, which is the price at which the NNPC sells to oil marketers, the subsidy payments were not scrapped.

READ MORE: https://www.icirnigeria.org/explainer-price-adjustment-on-petrol-pump-price-to-n125-is-not-subsidy-removal/

Ok
I was thinking this will be the best time to remove the subside and free up fund for other developmental project.

Does FG have send3

ok