Why Nigerians may buy petrol at N200 per litre

By Tunde Shorunke

From all indications, Nigerians and business owners who depend on petrol for their daily activities, due to epilectic power supply in the country should not expect any respite from the federal government in respect of the continuous hike in the petroleum pump price, as it is edging towards N200 per litre.

This is because, despite acknowledging the hardship compounded by the recent hike in petrol pump price, the minister of Petroleum Resources, Timipre Sylva, has reiterated that the federal government stands on deregulation of Premium Motor Spirit (PMS) otherwise known as petrol.

He, therefore, explained that the market has been deregulated fully and the prices are left to be determined by market forces. Sylva, while reacting to the impact of the latest hike in the PMS on the ordinary Nigerians in Abuja after a closed door meeting with President Muhammadu Buhari said, “These are not the best of times not only for Nigeria but for the global community.

Why do we have to do this? It is clearly impossible for the government to continue to subsidize. The money is not there now.”

According to the minister, just take the example of our production levels, our crude oil production level was over 2 million barrels a day, today, to comply with OPEC cut and quota, we have reduced production to 1.4 million barrels.

“Having reduced production to 1.4 million barrels, crude oil is also not selling at an optimal rate . Where do you get the money to continue to subsidize”, he said.

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He further explained that the earnings of the government have reduced by 60 per cent and that what is happening in the oil sector reflects what is happening elsewhere.

Sylva, who said his meeting with the President Buhari as the Minister of Petroleum was routine, added that the recent hike in the global crude oil price was attributable to the announcement of a vaccine for COVID-19 by Pfizer.

“If the price of crude oil goes up, then it means the price of the feedstock has gone higher.

It will also affect the price of the refined product and that is why you see that product prices are usually not static. It depends on the price of crude oil, which goes up and down”, he said.