FG still paying about ‘N1trn’ every month on fuel subsidy, Pinnacle Oil boss alleges

Robert Dickerman, Chief Executive Officer of Pinnacle Oil and Gas Limited, has purportedly claimed that the Nigerian government continues to pay one trillion naira every month in petrol subsidies.

This is despite President Bola Tinubu’s announcement on the day of his inauguration that all petroleum products would be deregulated.

Pinnacle Oil has recently revealed that Nigeria currently spends nearly N1 trillion per month on petrol subsidies.

Dickerman shared this information during a panel discussion during session six of Nigeria’s Downstream Forum at the recently concluded Nigeria International Energy Summit (NIES) in Abuja.

He said that a considerable subsidy is still in place, adding that this has contributed to the product’s inexpensive price and could potentially feed smuggling activities to surrounding nations.

“Foreign investors, foreign lenders and government-run DFIs have been very clear about what they want to see: Conservative fiscal policy, tackling corruption, enabling competitive markets, and enforcement of fairness in markets through policy, regulation and the ability to enforce contracts. Keeping that context in mind, I want to point out that there is still a massive subsidy in PMS, albeit in the FX portion of PMS Price, not the global price in dollars.

“The consequences of this subsidy are: The cost of gasoline in Nigeria is the lowest in Africa by far, which encourages smuggling out, further depriving Nigeria of value.

“Smuggling causes Nigeria to subsidize neighboring countries even while our economy struggles. The cost is hurting the entire budget, Federal and State, as critical programs cannot be funded to pay this subsidy. It is currently calculated to be about 1 trillion Naira/month.

“Also, with this subsidy in place, ceasing subsidy payments would result in no petrol supply, if there are no refineries producing gasoline. All supplies come from the international market which will only sell at market prices.”(DAILY POST)

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