Market realities driving up petrol price – Kyari

*Says prices will normalize within two weeks The Group Chief Executive Officer of the Nigerian National Petroleum Company Limited, Mele Kyari, has said that the sudden hike in pump price of petrol in filling stations across the country is a reflection of the realities of the market. Despite having supplies, the filling station still went ahead to hike the price of their products. Speaking on a television program monitored by NIGERIAN ANCHOR on Thursday, Kyari said that the situation applies to all commodities and that it portrays the reality of the market.      “It could have been the other way round; prices could have collapsed downwards and those holding the old stock would have to sell at lower prices to arrive at market condition. “It is not something serious or strange, this is a stock management issue and it is very typical, no one can do anything different about this. “The prices we are seeing today at our stations are the current price of the commodity. This means that prices in the market can go down at any time and of course, the market will adjust itself,” Kyari said. The GCEO however assured that the fuel hike currently being experienced will normalize in the next 2-3 weeks because competition among major players in the oil sector would force down the price of petrol.   He added that the subsidy removal would allow new entrants into the market, a move he said, would aid competition and phase out monopoly. “The beauty of this (subsidy removal) is that there will be new entrants (into the market) because oil marketing companies’ reluctance to come into the market all along is the very fact of the subsidy regime that is in place. “And that subsidy regime doesn’t have a guarantee of repayment back to the those who provide the product at subsidise price and now that the market is being regulated, oil marketing companies can actually import product or even if it is produced locally, they can buy and take it into the market and sell it at its retail price. “Therefore, you will see competition, even with NNPC. And by the way, by law, NNPC cannot do more than 30 percent of the market going forward. As soon as the market stabilises, oil marketing companies will be able to come in,” he explained.

NSCDC arrests 3 black marketers, impounds crafted vehicles

The Niger Command of the Nigeria Security and Civil Defence Corps (NSCDC), has arrested three suspected ‘black marketers’ for fabricating huge extra tanks in their vehicles. The Public Relations officer of the corps, DSC Nasire Abdullahi, stated this while addressing news on the arrest in Minna on Wednesday. He said that the command had also impounded four vehicles used for the operation. According to him, the Anti-Vandal Squad of the command, acting on credible intelligence on Tuesday, arrested four vehicles at the mega station of the Nigerian National Petroleum Company (NNPC) in Minna. “It was discovered that the vehicles were fitted with special constructed fuel tanks,” he said. He said  the suspects are, Ismaila Mohammed, 27, Ibrahim Usman, 42 and Idris Adamu, 39. The spokesman said that the driver of one of the vehicles escaped and efforts were on to arrest him. Abubakar said that the suspects would purchase the PMS at the Federal Government regulated price of N196 per litre, and sell to the public at  N250 and N300. He said that the activities of the suspects was causing untold hardship for members of the public. Abdullahi said that one of the vehicles, a Toyota Corolla carried  500 litres of PMS in a fabricated constructed tank with 14 jerry cans measuring 25 litres. He said that the second vehicle, a Toyota car  also carryied an inbuilt tank of 500 litres, while the third, a Jetta car carried constructed 200 litres with a normal 70 litres removed from another vehicle. Abubakar said that the fourth vehicle whose driver escaped  carried inbuilt tank measuring 1,000 litres. He said  that the Manager of the NNPC mega station has been invited for questioning. Abdullahi said that after diligent investigations the suspects would be arraigned in court. He said that the corps would not relent in its task to protect the critical assets of the country. “The NSCDC will continue to keep 24 hours surveillance in all government facilities in Niger. “The corps will clampdown on vandals and other economic saboteurs,” he said. Ibrahim Usman, one of the suspects said that he ventured into the business because he has no job. Usman who has two wives and 13 children,  said that they normally  tip the fuel pump attendants at NNPC to get the PMS. “We give them N2, 000 to N3,000 to sell fuel to us. “I cannot steal to take care of my family, so I have to go into buying and selling of fuel,” he said. President Bola Tinubu had on Monday announced the end of fuel subsidy, making the NNPC and other filling stations to increase the pump price between N537 and N600 per litre across the country.

Fuel price increase will accelerate inflation — NECA

The Nigeria Employers’ Consultative Association (NECA) has said that increase in pump price of fuel would further accelerate inflation, which would distort and destabilise economic activities. Its Director General, Mr Adewale-Smatt Oyerinde, made the assertion in a statement on Wednesday in Lagos. Oyerinde said also, that the increase would shrink private sector business capital and lower the real disposal income of the people. ‘’The inaugural address of the president on fuel subsidy has generated heated reaction, with fuel queues returning to the petrol station and the prices of goods and services increasing astronomically. ‘’The increase, if not well managed, could lead to an increase in the prices of goods and services with consequential effects on the purchasing power of the already impoverished Nigerian. ‘’No doubt therefore, the economy would contract in terms of growth; business activities will face serious backlash; and aggregate consumption will fall due to inflationary pressure, ‘’ he said. The NECA boss said that, while it was desirable to remove the fuel subsidy, it was also important that the removal was systematically and strategically done. According to him, this is in order not to further impoverish and worsen the already bad socio-economic indicators such as employment, poverty per capital income and many more. Oyerinde said: ‘’It is worrisome to note that prices of other commodities have skyrocketed few hours after the president’s pronouncement of subsidy removal. ‘’Consequently, it is critically important that the new government approaches the removal of the subsidy with caution to circumvent further degeneration in the economy. ‘’We reiterate that in the spirit of frontally addressing corruption as stated in the president’s inaugural address, efforts should be stepped up to complete the rehabilitation of the refineries to complement the Dangote Refinery that just came on board recently. ‘’With the measure, it will be possible to attain scale in Premium Motor Spirit refining in the country so as to moderate domestic prices.‘’ NECA is the umbrella organisation of employers in the organised private sector of Nigeria. 

Subsidy Removal: NLC rejects new fuel pump price template

The Nigeria Labour Congress (NLC) has urged the Federal Government to immediately instruct the Nigerian Petroleum Company Ltd (NNPCL) to withdraw the just released pricing template to allow free flow of discussions by all parties. Mr Joe Ajaero, the NLC President, made the call in a statement signed by him and made available to newsmen on Wednesday in Abuja. Ajaero said that the new pricing template is vexatious, an ambush and may scuttle its ongoing dialogue with the federal government. According to Ajaero, government cannot in one breathe be talking about deregulation and at the same time fixing the prices of petroleum products. “We are worried that the Government through the NNPC despite the ongoing meeting of stakeholders in the Oil and Gas sector to manage the unilateral. “But unfortunate announcement by the President to withdraw subsidy on petroleum products, went ahead this morning to announce a new regime of prices under a new pricing template. “This is an ambush and runs against the spirit and principles of Social Dialogue which remains the best platform available for the resolution of all the issues arising out of the petroleum Down-stream sector. “This negates the spirit of allowing the operation of the free market unless the government has, as usual, usurped, captured or become market forces. “It is therefore unacceptable and we seriously condemn it. Good faith negotiation is key to reaching agreement,” he said. He added that what the government has done is like holding a gun to the head of Nigerian people and bring undue pressure on the leaders, thus undermine the dialogue. The NLC president said that Nigerians would not accept any manipulation of any kind from any of the parties, especially from the representatives of the government. “Our commitment to this process is buoyed on the fact that all the parties would be committed to ensuring that it is carried out within the ambits of liberty without undue pressure. “The release of that Template may not allow us to continue if nothing is done to withdraw it so that the dialogue can continue unhindered. It is clear that Government is actually trying to scuttle the process. “As it stands, the federal government has become fixated on their chosen course of action. Would this help this dialogue? It clearly will not. “There must be flexibility to allow concessions and reasonable accommodation that will produce the best result for Nigerian people. This is what we all seek at this time,” he said. 

Nigerians groan as Presidency, NNPCL hike fuel pump price to N555PL

Details of the Tuesday meeting between President Bola Tinubu and the Group Chief Executive Officer of the Nigeria National Petroleum Company limited (NNPCL), Malam Mele Kyari,  has emerged as the company has rolled out template for new pump price per litre nationwide. Malam Kyari had on Tuesday had a closed door meeting with President Tinubu, following the controversy generated by inaugural speech comment on removal of fuel subsidy. Template for hike in fuel pump price per litre as categorized according to geopolitical zone effective, 31 May, 2023. Under the new prices depending on geopolitical zone, a price per litre will not cost less than N488  but will cost at most N555. The NNPCL has also directed dealers to reflect the new pump price in the respective geopolitical zones effective today, 31 May, 2023, in line with the released price templated. “Please implement meter change as approved effective today 31st May 2023. Wayne is to attend to all locations as relates to their area of coverage in our network”, the directive stated. A statement by Garba Muhammad, Chief Corporate Communications Officer NNPC Limited said as it strives to provide quality service which the company was known for, prices would continue to fluctuate to reflect market dynamics. “The NNPC Ltd. wishes to inform our esteemed customers that we have adjusted our pump price of PMS across our retail outlets, in line with the current market realities. “We assure you that NNPC Ltd. is committed to ensuring ceaseless supply of products. “The Company sincerely regrets any inconvenience this development might have caused,” Muhammad said. He appreciated the continued patronage, support and understanding of its customers through this time of change and growth. The sudden increase in pump price per litre contradicted President Tinubu’s explanations of his inuagural speech comment on immediate removal of fuel Subsidy. He had on Tuesday said that the removal would take effect end of June, 2023, in attempt to allay fears and tempers heightened by acute shortage of fuel and hike in prices by dealers following his inaugural speech comment of fuel Subsidy removal. Nationwide, following his inaugural speech, queues have returned to the fueling stations. While dealers who are open for operations have hike their pump price up to between N600-N700 per litre, just as most filling stations closed shop. Commuters nationwide have been stranded as transporters have hiked the fares resulting to chaotic situation just two days on assumption of office by President Tinubu. Reports indicate that motorists who had queued up overnight for fuel now refused to buy at the newly reflected high pump price per litre.

Hoarding/Profiteering: Gov Diri warns marketers as fuel price hits N600

Governor Douye Diri of Bayelsa has warned oil marketers in the state against hoarding and profiteering on Premium Motor Spirit (PMS), commonly known as petrol. The warning is sequel to the sudden hike by fuel marketers of PMS to N600 per litre, following President Bola Tinubu’s pronouncement in his inaugural address that fuel subsidy was gone. Diri, in a statement issued by his Chief Press Secretary, Mr Daniel Alabrah on Wednesday, warned that his administration would take stern measures against any filling station that flouted the directive.  He said the state government had received reports that some filling stations in the state capital had hiked the pump price of petrol above the usual price of between N193 and N250 per litre to N500 per litre and above. “Marketers in the state are said to have reacted to the pronouncement of President Bola Tinubu during his inauguration on Monday that the Federal Government subsidy on petrol is gone. “The Presidency, however, issued a clarification statement on Tuesday that the removal of the subsidy was yet to take effect,” the statement read in part. The governor said it was wicked for oil marketers to swiftly seek to profiteer at the detriment of the people following a mere pronouncement that had not taken effect. Diri noted that the pump price of petrol is a significant determinant of the cost of goods and services in the country. The governor assured that his administration would not allow the people of Bayelsa to suffer undue hardship from the profiteering activities of some greedy businessmen. Diri said he had directed the state Ministry of Mineral Resources and the petroleum task force in the state to shut any filling station hoarding the product or caught selling above the usual pump price. He said: “I have directed the relevant Ministry and the state’s task force on petroleum to ensure that all filling stations sell petrol within the usual price range. “I have equally directed that any filling station that flouts this directive or fails to revert to the usual price be shut down. We will take further stern measures against any station that defaults. “This directive takes immediate effect,” Diri said.

Subsidy: Kyari meets Tinubu, says fuel queues won’t last

The Nigerian National Petroleum Company Limited (NNPC Ltd) has assured Nigerians that fuel queues in filling stations, following the affirmation of the removal of subsidy, will soon vanished. Malam Mele Kyari, the Group Chief Executive Officer (GCEO), briefed State House correspondents after meeting  President Bola Tinubu on Tuesday at the Presidential Villa, Abuja. Tinubu, had in his inaugural speech on Monday, commended the past administration for phasing out the petrol subsidy regime, which had increasingly favoured the rich more than the poor. Kyari said that the Petroleum Industry Act (PIA) stipulated that the price of petroleum should be determined by market forces. “I know all us must have seen the fuel queues in filling stations across the country. “It is very understandable that whenever announcements to changes to prices of petroleum happen, both buyers and marketers will like assurance of what exactly this means and typically, consumers will rush to the filling stations to fill their tanks and that is why you are seeing these queues. “And also for marketers, they will like to see exactly what this means in terms of how are we going to sell the products if subsidy on PMS is removed? “And the combination of the two is what you are seeing -the obvious dislocation on distribution and we believe that this will go away very quickly. “And as you may be aware, PIB which was accented in 2021 and became an Act, made it clear that the price of petroleum must be priced at the market,” Kyari stated. He said, however, that the government also decided to provide for subsidy in the 2022 Appropriation Act and also for half year in 2023. According to him, while the PIA is clear that petroleum should be priced, but it did not say that government cannot put its money in any way it wants. “Therefore, we, as a commercial company established by the PIA, we are doing it strictly as business; delivering value as supply of last resort by virtue of the law but at a cost to the federation. “And that cost includes the cost of subsidy; this subsidy cost should have been money that will be given to the NNPC, may be on monthly or daily basis. “However, since the provision of the N6 trillion in 2022 and N3.7 trillion in 2023, we have not received no payment whatsoever from the federation; that means they are unable to pay and we continue and continue to support the subsidy from the cash flow of the NNPC.” He also explained further:“That is when we net off our physical obligations of taxes and royalties, there is still a balance we are funding from our cash flow and that has become very difficult, and it affects our other operations. “We are not able to keep some of this cash to invest in our core businesses and the end result is that it can be a huge challenge for the company. “And we have highlighted this severally to government; that they must compensate NNPC; they must pay NNPC for the money we have spent on subsidy.’’ The NNPC Ltd boss said that by virtue of the law and the Appropriation Act 2023, funding was no longer available while the country could no longer fund the subsidy and no longer able to pay NNPC. “Therefore, we are pleased to note the president’s commitment to the removal of subsidy because they cannot afford it anymore.

Subsidy Removal: NLC kicks, urges Tinubu to put palliative measures in place

The Nigeria Labour Congress (NLC) has lambasted new President Bola Tinubu for removing fuel subsidy without due consultations, urging him to ensure palliative measures are put in place to ease workers’ sufferings. Mr Joe Ajaero, the NLC President, made the appeal in a statement made available to newsmen on Tuesday in Abuja. It would be recalled that Tinubu announced the fuel subsidy removal during his inaugural speech on Monday, saying that subsidy can no longer justify its ever-increasing costs in the wake of drying resources. Tinubu pledged to re-channel the funds into better investment in public infrastructure, education, healthcare and jobs that would materially improve the lives of millions. Ajaero said that the NLC would staunchly oppose the decision. “We at the Nigeria Labour are outraged by the pronouncement of President Bola Tinubu removing ‘fuel subsidy’ without due consultations with critical stakeholders. “Or without putting in place palliative measures to cushion the harsh effects of the ‘subsidy removal,” he said. He said that within hours of Mr President’s pronouncement, the nation had gone into a tailspin due to a combination of service shut downs and product price hike, in some places representing over 300 per cent price adjustment. He said that by the decision, Tinubu on his inauguration day had brought tears and sorrow to millions of Nigerians instead of hope. The NLC president also said that Mr President had equally devalued the quality of their lives by over 300 per cent and counting. According to him, it is no heroism to commit against the people this level of cruelty at any time, let alone on an inauguration day. “If he is expecting a medal for taking this decision, he would certainly be disappointed to receive curses for the people of Nigeria consider this decision not only a slight but a big betrayal. “On our part, we are demanding the immediate withdrawal of this policy. The implications of this decision are grave for our security and well-being. “We wonder if President Tinubu gave a thought to why his predecessors in office refused to implement this highly injurious policy decision?”. He added that “we also wonder if he also forgot the words he penned down on January 8, 2012, but issued on January 11, 2012. “In light of the foregoing, we advise Tinubu to respect his own postulations and economic theories instead of daring the people. It could be a costly gamble,” he cautioned. 

Subsidy Removal: We’ll tackle supply disruptions – NMDPRA

*Urges Nigerians not to panic The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has said it is working with NNPC Limited and other stakeholders to guarantee a smooth transition following the removal of fuel subsidy. President Bola Tinubu, in his inaugural speech on Monday, said the fuel subsidy regime had ended with the commencement of his administration. NMDPRA made this known on Tuesday in a statement signed by Mr Kimchi Apollo, General Manager, Corporate Communications, NMDPRA, to address concerns regarding the removal of fuel subsidy. Apollo said the authority was working to avoid disruptions in the supply of Premium Motor Spirit (PMS), also known as petrol, as well as ensure that consumers were not short-changed in any form. He assured that there was an ample supply of PMS to meet demand and that the authority had taken necessary steps to ensure that distribution channels remained uninterrupted and fuel readily available at all filling stations nationwide. He urged Nigerians not to panic over the removal of subsidy as the authority had ensured availability of petrol nationwide. “Contrary to speculations and concerns, the announcement is in line with the Petroleum Industry Act (PIA 2021), which provides for total deregulation of the petroleum downstream sector to drive investment and growth. “We, therefore, call on Nigerians to remain calm and resist the urge to stockpile as it poses a significant safety hazard. “The NMDPRA reassures all Nigerians that the removal of subsidy on PMS is a step towards building a more sustainable and prosperous future for our nation. “We will continue to monitor activities and implement necessary measures to enhance transparency and accountability in the petroleum downstream sector,” he said. 

Subsidy is gone, Tinubu declares in inaugural speech

*Says hope is back for Nigeria Nigeria’s new President, Bola Ahmed Tinubu has said that his government will not continue with the current fuel subsidy regime, declaring that “Fuel Subsidy is Gone!” Tinubu said those seeking redress in court concerning his election are doing so within their constitutional rights and he wishes them well. According to the new President, his government is going to concentrate on revamping the economy, and he would work on providing a unified exchange rate for the economy. “Subsidy is gone! It can no longer be justified. We shall channel our efforts toward education, infrastructure, and other areas to ameliorate any suffering. We shall work towards a unified exchange rate and meaningful investment. More details later…