₦airaland Forum

Thanks to the Dangote refinery that has finally come to our rescue in the energy sector.
With the current inflation in the country, any hike in PMS pump price will further aggravate the sufferings of Nigerians.
In my candid opinion, the subsidy regime should be sustained. This is because I expect Dangote to sell to independent marketers or NNPCL at a reasonable price of not more than 600/700 per litre. The government can then subsidize it to at least 350/400 per litre.

What's your take on this. Remember that Dangote will be paying for crude in naira and other expenses like landing cost is no longer there.

Why not N1 a litre?

Nigeria's debt profile

Local debt - 100 Trillion naira

Foreign debt - 100 billion dollars

We don't even know how we are going to pay these debts.

If the government continues subsidy the way you are suggesting, that debt will go up exponentially and naira's value will heads towards N2000, which will in turn increase fuel price, and further increase subsidy.

You can see there will be no end to the spiral of high petrol prices, which will lead to higher subsidy payment, which will lead to more debt, which will lead to even higher exchange rate, which will lead to higher prices of goods and condemn the country to a permanent economic malaise.

Knowing the above, do you still want that subsidy?

Or do you think we should stop subsidy, take the short term pain (2 years or so), tighten our belt, start paying back our debts, improve naira's exchange rate, which will lead to reduction of prices of goods.

Which one do you want sir.

DeLaRue:
Nigeria's debt profile

Local debt - 100 Trillion naira

Foreign debt - 100 billion dollars

We don't even know how we are going to pay these debts.

If the government continues subsidy the way you are suggesting, that debt will go up exponentially and naira's value will heads towards N2000, which will in turn increase fuel price, and further increase subsidy.

You can see there will be no end to the spiral of high petrol prices, which will lead to higher subsidy payment, which will lead to more debt, which will lead to even higher exchange rate, which will lead to higher prices of goods and condemn the country to a permanent economic malaise.

Knowing the above, do you still want that subsidy?

Or do you think we should stop subsidy, take the short term pain (2 years or so), tighten our belt, start paying back our debts, improve naira's exchange rate, which will lead to reduction of prices of goods.

Which one do you want sir.

Where you thinking this way in 2012 when GEJ was the president?

Why I asked was that, this was the same reason GEJ gave for the removal of Fuel subsidy but people occupy Ojota and Nigeria.

SMH

Petrol is more expensive than 700 on the internatiobal market.

[quote author=DeLaRue post=131866850 ]Nigeria's debt profile

Local debt - 100 Trillion naira

Foreign debt - 100 billion dollars

We don't even know how we are going to pay these debts.

If the government continues subsidy the way you are suggesting, that debt will go up exponentially and naira's value will heads towards N2000, which will in turn increase fuel price, and further increase subsidy.

You can see there will be no end to the spiral of high petrol prices, which will lead to higher subsidy payment, which will lead to more debt, which will lead to even higher exchange rate, which will lead to higher prices of goods and condemn the country to a permanent economic malaise.

Knowing the above, do you still want that subsidy?

Or do you think we should stop subsidy, take the short term pain (2 years or so), tighten our belt, start paying back our debts, improve naira's exchange rate, which will lead to reduction of prices of goods.

Which one do you[/quote]

nikky5:
Thanks to the Dangote refinery that has finally come to our rescue in the energy sector.
With the current inflation in the country, any hike in PMS pump price will further aggravate the sufferings of Nigerians.
In my candid opinion, the subsidy regime should be sustained. This is because I expect Dangote to sell to independent marketers or NNPCL at a reasonable price of not more than 600/700 per litre. The government can then subsidize it to at least 350/400 per litre.

What's your take on this. Remember that Dangote will be paying for crude in naira and other expenses like landing cost is no longer there.

refineries don’t buy crude from one source. Dangote has bought from Usa, Brazil in addition to the naira ones from NNPC.
His loans are in USD, most of the workers are Indians being paid with dollars, the refinery produces its own power and also has a private port.

I don’t think his cost of production is below 1,000 in this initial stages.

DeLaRue:
Nigeria's debt profile

Local debt - 100 Trillion naira

Foreign debt - 100 billion dollars

We don't even know how we are going to pay these debts.

If the government continues subsidy the way you are suggesting, that debt will go up exponentially and naira's value will heads towards N2000, which will in turn increase fuel price, and further increase subsidy.

You can see there will be no end to the spiral of high petrol prices, which will lead to higher subsidy payment, which will lead to more debt, which will lead to even higher exchange rate, which will lead to higher prices of goods and condemn the country to a permanent economic malaise.

Knowing the above, do you still want that subsidy?

Or do you think we should stop subsidy, take the short term pain (2 years or so), tighten our belt, start paying back our debts, improve naira's exchange rate, which will lead to reduction of prices of goods.

Which one do you want sir.

All Goverment Officials should resign Ask Nigerians For FOrgiveness,

Make Penace If not Commen sense is they will Rot in hell, You can suffer people and escape energy and law of karma doesnt work like that.