Subsidy Removal: Nigerians To Pay N142.92 Per Litre For Petrol

Nigerians will pay N142.92 for a litre of petrol by January 1, 2012, if petrol prices remain at the present level when the subsidy on the product is withdrawn.

According to the pricing template posted on the website of the Petroleum Products Pricing Regulatory Agency, on Friday, a litre of petrol should have been selling currently at N142.92 as against the official price of N65.

Nigeria is currently consuming about 32 million litres of petrol daily for N65, while the expected price for the product is N142.92, which means government currently pays a subsidy of N77.92 per litre.

Although, the nation has a crude refining capacity of 445,000 barrels of crude oil per day, the refineries are comatose and the country depends largely on fuel importation to meet its domestic demand.

When the subsidy is finally withdrawn, analysts forecast that there will be rise in transport cost and inflation.

The Federal Government at the beginning of the year set aside N240bn in 2011 budget for oil subsidy in which N20bn was billed to be spent monthly.

However, by the end of the year, the Federal Government would have spent N1.2tn on fuel subsidy against the N240bn appropriated by the National Assembly.

President Goodluck Jonathan had, on Tuesday conveyed to the National Assembly the intention of his government to begin the removal of fuel subsidy next year. Jonathan disclosed this to the National Assembly in a letter conveying his administration’s Medium Term Expenditure Framework and a N4.8tn budget for the 2012 fiscal year.

The covering letter for the budget read in part, “A major component of the policy of fiscal consolidation is government’s intention to phase out the fuel subsidy, beginning from the 2012 fiscal year.

“This will free up about N1.2tn in savings, part of which can be deployed into providing safety nets for poor segments of the society to ameliorate the effects of the subsidy removal.”

It was also learnt that the amount to be saved via the removal of fuel subsidy, would be invested in infrastructure development for the petroleum sector. This, to a large extent, is expected to boost local production of the product as against massive importation, which is currently the trend.

In this light, FG had expressed optimism that potential investors would be attracted to the country, especially in terms of building new refineries, which might in the long-run bring down the price of petrol

cap28:

i remember not too long ago some fools were falling over themselves and heaping praises on the world bank puppet Okonjo Iweala - this is her present to all of you fools that were worshipping at her alter - starvation and mass poverty is her present to all of you fools brought to you courtesy of the IMF and world bank - ENJOY YOUR FRESH AIR!!!!

aurenflani:

otokx - nothing go happen except masses, the slaves of the system will continue with their 'shuffering and shmilling'. the unfortunate victims of 'divide and rule'. remember when the masses from d north rise against pdp and inec mago-mago elcthieveneering this yr, d masses from d south quickly dismiss them as silly 'almajiris.'

ReLaTE:

Many lives will nw be wasting when people will start hoarding fuel in their houses after hearing the news.

jason123:

Wait a minute! Do they expect people to survive on 18000 Naira minimum wage with this increment? I dey seriously laugh. As the Yoruba peeps will say, "Esu fun e ni fila, o gba sokoto ati buba". That is, "the devil gave you a cap for your head but collected your trousers and shirt as payment". NLC, over to you . . .

toba:

lets go down memory lane
Babangida regime price/litre was N5

Abacha increased the price to N11 in 1994 or so

Abdulsalam increased the price to N20 in 1998

OBJ increased the price to N22 in 2000

OBJ increased price to N26 in 2002

Obj increased price to N30 in 2003

OBJ increased price to N37 in 2003

OBJ increased price to N40 in 2003

Obj increased price to N42 in 2004

Obj increased price to N50 in 2005

Obj increased price to N65 in 2005(which led to the death of ubani, the journalist on his way to Abuja to protest the increment)

Obj increased price to N75 in May 2007

Yar adua reduced price to N70 in June 2007 after nation wide strike

Yar adua in 2009 reduced price to N65 during the global reccession when a barrel of crude oil was sold for under $60

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I hope i got the dates right but the progression is very correct from Babangida to Goodluck. So new refineries could be built in over 25 years? during this period, Nigeria imported fuel from different countries including Libya in 2005 that damaged many cars in the country during Abacha's regime. too bad

jason2010:

Great news. The removal of fuel subsidy + naira depreciation to 200 naira per $1 + the Super eagles disgraceful performance yesterday, + the cancellation of independence day celebrations clearly spells revolution in Nigeria. The revolution has been long overdue. Hopefully we can kill all the corrupt politicians as we revolt

Sun of god:

The N18,000 was a gimmick - the govt never had any intention of paying it.

They are drawing up plans to tax people particulary those collecting a minimum of N18,000 from the govt.

The can collect the money from people's paychecks before giving them the balance.

The extortion of money will spread to the masses - at the same time rampant inflation kicks in.

Nigerians are in massive trouble - the future is looking bleak.

Society will change for the worse - Crime will spiral and starvation will become common.

2012 will be an interesting year - Nigeria will not be the same.

jason2010:

Great news. The removal of fuel subsidy + naira depreciation to 200 naira per $1 + the Super eagles disgraceful performance yesterday, clearly spells revolution in Nigeria. The revolution has been long overdue. Hopefully we can kill all the corrupt politicians as we revolt

pendulasis:

if this happens the price of basic amenities will skyrocket and i no Nigerians to always take advantage of  situation
transportation and food stuff will go up and will not comeback to the same price even if the price is reveled later