Good, government will be able to provide more social amenities.

CodeTemplar:
That's natural. Its part of the offshoot of subsidy removal.

If FG should remove subsidy from schools too, it could take hundreds of billions off FG's neck and take fees of fed unis to N600k per student.

They may do that soon

Donedeal1:
Good, government will be able to provide more social amenities.

Were they providing it ?

call for high quality cashew nut KOR of 48 -55......07032683191

drealcivilceno:



So the change they will use for subsidy, they will now use it to clear their debt for you abi, OK!

You don't understand how subsidy works

Good am to you

MLTR:




To the best of your knowledge, you rather have us pump money on obsolete refineries that we know won't work( naija factor) than to keep subsiding and keep cost of production @ minimal.
Let me ask you, if you have a car that breaks down on a daily bases, would you rather keep spending money on that car daily just to satisfy the urge you drive or opt for a uber/taxify, which is more feasible

No, we remove subsidy and we use the profits gained to fix the refineries and build new ones

And investment comes in to build more

Simple

Emyogalanya:
all these and you are planning to borrow to fund ur budget?

Removing subsidy completely will lessen the borrowing for budget

MLTR:





Bro enough of these textbook nonsense, these is Nigeria by now every reasonable person with eye should have seen things don't go that way.
Judging from experience, spending more money on our refineries is a waste of time & resource its won't work because of immense corruption within the govt and oil sector.
since this administration stopped subsidy what have the people benefited directly from the govt, where are the infrastructure?
A continuous rise in fuel pump rise will forever cause rise in the cost living, if we can't enjoy anything from the FG. its more feasible they return subsidy instead of wasting more money on those refineries that will never work
We have gotten to the point an increase or a decrease per barrel is badnews to the people, for a decrease per barrel govt will cite budget as an excuse not to reduce and when it increases per barrel int'ly which should be gudnews govt will cite exchange rate beko as people what should we pray for.
Increase or decrease per barrel we no gain, infrastructure we no gain, subsidy seems to be the only way people can gain from these buhari govt. with current cost of production in nigeria a further increase in pump price will be suicidal to nigeria.
I thinks its unreasonable for anyone to use naija currency valve to judge other neighboring countries. besides most countries only need fuel for car therefore the price is highly insignificant.

Okay, then if you were running a business sellinh shoes at N8000 a pair after buying them for N5000 a pair and the government steps in and tells you to sell them at N1500 a pair instead while paying you a subsidy of 500 per pair meaning you lose 3000 per pair of shoes sold....you would be happy?

Think about it.

nedekid:

Oga, sorry to say, but you are naive.
We have been talking about this same subsidy issue since fuel was 0.60 kobo per liter. Even when abacha increase to 3.20k and later reduced to 1.60kobo. The same subsidy has been spoken about and increased to ₦85 per liter. The same subsidy removed and became ₦120, same subsidy 150, 160 now 180 and soon to be 200.
Oga, make price of fuel ₦10,000 per liter and within 1 month you will hear the same story, that government is subsidizing 10k fuel and it has to increase to ₦11,000!

Nna have you wondered why naira has not increased in value as crude oil price has gone up? Oil is now selling for $65 which means we have more $ income (that was the excuse for devaluation of naira).
Nigeria is the only country where things go up but never comes down.
Stupidly this government does not know that increasing cost of fundamentals means increase in inflation.

Value of naira is terrible because we aren't a manufacturing society that actively exports manufactued goods

Instead we are an oil dependent economy whose source of revenue is dependent on fluctuating oil prices which we spend on looting, subsidizing everything and also overimporting stuff we make at home...means we don't have enough dollars to keep the naira strong

Which accounts for the raises you talk about.

holafloyd:

Who is this one forming economy expert here?
Are you saying now that Niger of all countries is better than Nigeria? Why are our refineries not effective? Why is it so difficult for Nigeria to build refineries in due time?

Because we have been selling fuel below the cost of what it takes to refine it since the 1980s..and paying a subsidy that does not cover the loss made as a result

Niger does not do that. That's why they have the money to keep their refinery working. They sell fuel at 350 naira meaning there is enough profit to run the refinery.

Twob:


Mr Man! Forget this useless analysis. I will ask u a question and must be answered as soon as possible. The current international price of crude oil just rose to $63 per barrel from maybe, $57 per barrel and in result, it would translate to about N30 increment in the cost of buying a litre of petrol in Nigeria. So, if the crude oil international price per barrel rises to a value equal or greater than $100, what should we be expecting of the pump price?

Fuel would cost somewhere around N300 or more

But due to rising reveues from oil, goverment will reintroduce subsidy and keep fuel below 200 naira

Problem is, money that can be used for other things or saved gets spent on subsidy

Advocate500:
just as they will end up looting ur imaginary savings, continue to deceive yourself by misleading others in believing in a government that confused.

Democracy equals you holding leaders accountable

AlphaAlex:
Na una type government dey deceive on a regular basis nothing will happen to anything you spoke here and they will loot all the money just watch

Democracy works when we do the hard work called holding leaders to account

That's how the big countries do it

Joysticks:
Na una dey Abuja dey calculate nonsense in other to steal.

Huh? So explaining the dangers of oil price dropping to $10 automatically means I'm in govt stealing money?.... Our educational system in Nigeria really needs urgent attention... tueh!!

Racoon:

Everything boils down to failure of the government to implement the plan it had from the beginning.The residual refineries were not revamped as nor the new ones built as promised while they continue to loot while quiet claiming the subsidy they denounced as a fraud.

NNPC continued to be a huge source of economic wastage despite huge TAM, overhead costs etc while operating @ zero-capacity.Privitize the NNPC they said no.

Pass the PIB to regulate the downstream sector & open up the competitiveness they refused.Now global oil price continue to fluctuates.This is happening under the supervision of the president-the minster of petroleum.

Not sure of the link between this your response and what I said. Someone prayed for oil price to drop to $10 so pump price can be cheap. I simply advised the person to be wary of what they pray for cos a drop in oil price will cripple the economy in so many ways that pump price would be the least of our worries.

Meanwhile, you talked about govt fixing refineries - I personally dont want govt to spend a dime fixing any damn refinery cos the inherent Nigerian corruption would never let those refineries work; I prefer that the govt sells off the refineries. But then, the govt is currently following a good approach to solve our age long refining problem; i.e. providing licences and giving all the juicy incentives (forex, loans etc.) to private establishments to build refineries. Currently there are between 5-10 refineries under construction which would end our 3 decades long refining palaver. I prefer this approach to govt spending money on TAm.

Ykc2:
thank god you no dey live for Canada or German na all us go suffer it even if na you dey wipe Buhari's ass every morning

So explaining that oil price dropping to $10 will cripple the economy and not necessarily reduce fuel price, that automatically means I'm wiping Buhari's ass? That's the best your brain could pick from that explanation?.. Wonderful!

What actually needs wiping is the dust in your brain; our educational system indeed needs an urgent overhaul.

obailala:
So explaining that oil price dropping to $10 will cripple the economy and not necessarily reduce fuel price, that automatically means I'm wiping Buhari's ass? That's the best your brain could pick from that explanation?.. Wonderful!

What actually needs wiping is the dust in your brain; our educational system indeed needs an urgent overhaul.

where is your 1 dollar to 1 naira ?nkpi Gambia

Vardanes2:


Removing subsidy completely will lessen the borrowing for budget

Since 2015 ?

Countries that don't produce crude oil have cheap fuel than us!!

Nigeria has four refineries in Port Harcourt, Warri, Niger Delta and Kaduna (I've no clue why there's one there), yet they're moribund due to massive corruption!

Vardanes2:


Okay, then if you were running a business sellinh shoes at N8000 a pair after buying them for N5000 a pair and the government steps in and tells you to sell them at N1500 a pair instead while paying you a subsidy of 500 per pair meaning you lose 3000 per pair of shoes sold....you would be happy?

Think about it.

LOL !! what you're trying to insinuate is not even possible not to talk of been realistic.
subsidy is not a means of shortchanging the marketers. let me do a quick correction on your example.
If i sell shoes @ 8k to public school students and the price suddenly rise due to xchange factor to say 13k ... if the govt decides to bring in subsidy what they will be paying me is the difference i.e 5k while the student continue to pay 8k. that is the simplest way i can explain.
infact let me burst your bubble, subsidy is more beneficial to the marketers, corruption help them to get away with all kinds of fraud. hope you understand now.

Vardanes2:


No, we remove subsidy and[i] we use the profits gained to fix the refineries and build new ones

And investment comes in to build more[/i]

Simple

All these things you are saying make sense theory wise, buh opening your eye to reality nothing is working, what is the essence of spending so much on an obsolete refineries whose total production volume can't even cater for our daily use.
The truth is, its either we opt for subsidy that will benefit the people directly or let few cycle of people keep stealing our money all in the name of white elephant project.
In a country where fuel is an essential goods attributable to all lines of production & services it will be catastrophic to leave our fate in the hands of greed few.

MLTR:





LOL !! what you're trying to insinuate is not even possible not to talk of been realistic.
subsidy is not a means of shortchanging the marketers. let me do a quick correction on your example.
If i sell shoes @ 8k to public school students and the price suddenly rise due to xchange factor to say 13k ... if the govt decides to bring in subsidy what they will be paying me is the difference i.e 5k while the student continue to pay 8k. that is the simplest way i can explain.
infact let me burst your bubble, subsidy is more beneficial to the marketers, corruption help them to get away with all kinds of fraud. hope you understand now.

The price at which you buy the shoes also goes up to N10000 due to exchange factor, and government pays you N3000 as subsidy

So no profit, and you still don't earn much.

Emyogalanya:
Since 2015 ?

You don't understand how subsidy works...

So long as government cotnrols the prices...THERE is a subsidy.

Shey you beleived APC lies when they said they removed subsidy?

Vardanes2:


Value of naira is terrible because we aren't a manufacturing society that actively exports manufactued goods

Instead we are an oil dependent economy whose source of revenue is dependent on fluctuating oil prices which we spend on looting, subsidizing everything and also overimporting stuff we make at home...means we don't have enough dollars to keep the naira strong

Which accounts for the raises you talk about.

I get your point. But note that we manufacture. What we manufacture is crude oil! What you say about not being a manufacturing country applied mainly to countries that do not have natural resources like oil and also do not have any manufacturing base for export. Nigeria exports crude oil.
Now few years ago, our oil sold for less than $10 per barrel, we all know how much the ₦/$ exchange rate was, the oil price went up to $120 per barrel exchange rate remained at ₦140 to the $.
Now the crash of oil price world wide due to covid 19 was the reason this government gave for the devaluation of naira saying our fx earnings had reduced. Ok with the current increase to $65 per barrel, shouldn't the naira appreciate in value as our fx earning has tripped from bellow $20 to the current 65?
If your household earned 100k a month and reduced to 20k, then few months later 60k shouldn't there be a difference in the families standard of living?
I bet you that if oil price goes up to $200 per barrel, this government will give you excuses that we are not a manufacturing country and naira should exchange for ₦500 to 1$.

nedekid:

I get your point. But note that we manufacture. What we manufacture is crude oil! What you say about not being a manufacturing country applied mainly to countries that do not have natural resources like oil and also do not have any manufacturing base for export. Nigeria exports crude oil.

Crude oil is not something that is manufactured....we extract it as raw materials. it is when it is turend into many products...including petrol and kerosene....

We don't make crude oil...we extract it and sell

Now few years ago, our oil sold for less than $10 per barrel, we all know how much the ₦/$ exchange rate was, the oil price went up to $120 per barrel exchange rate remained at ₦140 to the $

That's because, quite simply, at $10 per barrel, we did not have enough dollars to buffer the naira...so the value of the naira went down tp 500 to $1

At $120 per barrel, we had enough dolalrs to buffer the naira...so the value of the naira went up..hence N140 to $1.

Now the crash of oil price world wide due to covid 19 was the reason this government gave for the devaluation of naira saying our fx earnings had reduced. Ok with the current increase to $65 per barrel, shouldn't the naira appreciate in value as our fx earning has tripped from bellow $20 to the current 65?

We still have to pay the debts we incrred from low oil prices when oil prices fell...which impacts on our using dollars to buffer the naira

Also, the fact is, we need oil at $133 per b arrel for us to run a banaced budget. It is called our breakeven price...and it is high because of high cost of extracting crude here...and our high populaiton of 206 million people

I bet you that if oil price goes up to $200 per barrel, this government will give you excuses that we are not a manufacturing country and naira should exchange for ₦500 to 1$.

No, based on past experiece, the value of the naira will shoot up again...but that won't make me happy. What would make me happy is if we left oil behind and went into manufacturing and exporting what we make...which would give us a stable supply of dolalrs, and be better for our economy

Which sadly this government and past governments don't want to do.

Vardanes2:


GEJ sold fuel at N65 in 2010, raised it to N140 in 2012, then brought it down to N97 in 2012, then N87 in 2015.

At the time, the landing cost of fuel was N99 IN 2012, and it went up to N132 in 2015

At the end of the day,GEJ spent biillions of Naira on fuel subsidy, which outside the cities of Abuja and Lagos had ceased to exist by 2013...fuel was retailing for above N100 in many cities across the country....because it was becoming difficult to sustain financialy

In 2012, gej raised fuel from N65 to N140...so that subsidy could end, and so that investment could pour into the country..so that we could have new refienreis, and so that NNPC oculd have the funds to fix refinereis.

Nigerians protested, GEJ cut the price to N97....and the money that could have been saved, and the profits that could have been ivnested in new refinereis was spent on sustaining an unsustainable subsidy


And you want Buhari to repeat the same mistake...or rather to worsen a mistake he is already making by subsidising fuel to N87 or to his mythincal N40 since you guys love cheap fuel too much.

Horseshit..Absolute horseshit..Oya,since Buhari removed the subsidy,the billions that is saved,how far?

IgboWarlord:


Horseshit..Absolute horseshit..Oya,since Buhari removed the subsidy,the billions that is saved,how far?

1.I am not abusing GEJ . Infact, I believe he saw the issues we would face from maintaining subsidy since 2011...which is why he took the 'wild' decision or raising prices from N65 to N140...which if it had been kept would have saved money for the exchequer...and maybe attracted more investment in domestic refining.

The post shows the problems that arose from the decision to reverse that increase...and also to correct the impression that GEJ 'kept prices low'. (He did, but at the cost of economic stability.)

2.SO long as the government sets the price of fuel..there is a subsidy. Buhari has never removed subsidy. If he did, I would have been paying N200 per liter for fuel since 2015...and possibly there would have been more savings.

In 2015...fuel cost N87 'officially'...but cost N132 per liter to import. Buhari raised prices to N145..AND 'ended subsidy'...till the landing cost rose above N145...after which he made NNPC the sole importer, made them bear a large part of paying the subsidy costs, and then paid off the outstanding claims from 2013 for the makreters from imprting fuel

Of course, it was not a good idea...NNPC now spends most of its money imprting and subsidsing fuel...and thus has limited cash to fix the refienreis...and won't privatise them because inevitably that means higher prices...and APC gets kicked out of power.

Vardanes2:


1.I am not abusing GEJ . Infact, I believe he saw the issues we would face from maintaining subsidy since 2011...which is why he took the 'wild' decision or raising prices from N65 to N140...which if it had been kept would have saved money for the exchequer...and maybe attracted more investment in domestic refining.

The post shows the problems that arose from the decision to reverse that increase...and also to correct the impression that GEJ 'kept prices low'. (He did, but at the cost of economic stability.)

2.SO long as the government sets the price of fuel..there is a subsidy. Buhari has never removed subsidy. If he did, I would have been paying N200 per liter for fuel since 2015...and possibly there would have been more savings.

In 2015...fuel cost N87 'officially'...but cost N132 per liter to import. Buhari raised prices to N145..AND 'ended subsidy'...till the landing cost rose above N145...after which he made NNPC the sole importer, made them bear a large part of paying the subsidy costs, and then paid off the outstanding claims from 2013 for the makreters from imprting fuel

Of course, it was not a good idea...NNPC now spends most of its money imprting and subsidsing fuel...and thus has limited cash to fix the refienreis...and won't privatise them because inevitably that means higher prices...and APC gets kicked out of power.

Thanks,i understand you now...

Ykc2:
where is your 1 dollar to 1 naira ?nkpi Gambia

$1 = N1, what does that have to do with the oil price and fuel price we're talking about?... Like I said before, your brain needs dusting, not buharis ass.. ezi ohia!

Vardanes2:


Crude oil is not something that is manufactured....we extract it as raw materials. it is when it is turend into many products...including petrol and kerosene....

We don't make crude oil...we extract it and sell



That's because, quite simply, at $10 per barrel, we did not have enough dollars to buffer the naira...so the value of the naira went down tp 500 to $1

At $120 per barrel, we had enough dolalrs to buffer the naira...so the value of the naira went up..hence N140 to $1.




We still have to pay the debts we incrred from low oil prices when oil prices fell...which impacts on our using dollars to buffer the naira

Also, the fact is, we need oil at $133 per b arrel for us to run a banaced budget. It is called our breakeven price...and it is high because of high cost of extracting crude here...and our high populaiton of 206 million people





No, based on past experiece, the value of the naira will shoot up again...but that won't make me happy. What would make me happy is if we left oil behind and went into manufacturing and exporting what we make...which would give us a stable supply of dolalrs, and be better for our economy

Which sadly this government and past governments don't want to do.

No, based on past experiece, the value of the naira will shoot up again...but that won't make me happy. What would make me happy is if we left oil behind and went into manufacturing and exporting what we make...which would give us a stable supply of dolalrs, and be better for our economy


Well said. I get all your points and that is the way it should be in a normal economy ran by sensible people.
My point in all this is that even if Nigeria has a manufacturing industry in every street, just as you have churches. If Nigeria supplies goods to half of the world just as China, you will still have same story. Another excuse will be given for gross incompetence. For years we have seen it all. My family right from the early 80ies had been into manufacturing with factories in Lagos, imo, kano, Benin. All died. All the other neighboring factories in iganmu industrial estate all died. It was more profitable to sell off your machines and rent out the space for storage or lease to churches than to manufacture. Cost of electricity, water bill(you have borehole ohh), local gov tax, federal tax, state tax, excise duty, fire service, waste management etc. It was cheaper to import from China.
Basically, the problem is incompetence. Let oil price be $1k per barrel and manufacture more than China, it is same story! We have seen it all.

Vardanes2:


The price at which you buy the shoes also goes up to N10000 due to exchange factor, and government pays you N3000 as subsidy

So no profit, and you still don't earn much.

I don't even know what you are all about anymore, i can't explain twice, just look for people around you that can read simple english.

Vardanes2:


You don't understand how subsidy works

Good am to you

Good pm to you. I may not know but I know this;

Subsidy or no subsidy... Things will not work coz they want it like that. Leave all of this Nigerian macroeconomics they are all shouting...