• Oil & Gas - News
  • Updated: August 01, 2022

Scarcity: We Have Not Removed Fuel Subsidies, Says FG

Scarcity: We Have Not Removed Fuel Subsidies, Says FG

The Premium Motor Spirit (PMS), also known as fuel, continues to be subsidised, according to the federal government.

Chief Timipre Sylva, Minister of State for Petroleum Resources, revealed this to journalists on Monday in Abuja.

A stakeholders' consultation forum on regulations hosted by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) was where the minister spoke.

The authority organised the conference to take into account and examine the midstream and downstream petroleum rules in order to leave the industry with laws and policies that will encourage necessary investment in the industry.

In response to marketers raising the price of gasoline at the pump from N165 per litre to N169, N184, or N218 per litre depending on the region in Abuja and other states, Sylva expressed her outrage.

“I can tell you authoritatively, we have not deregulated. The government is still subsidising petrol prices. If there are increases in price, it is not from the government.

“It is probably from the marketers but of course, I will talk to the authority to ensure that they actually regulate the price. This is not from the government, we have not deregulated.

“But a lot is going on to ensure that the queues end. As of yesterday, I noticed that the queues in Abuja are easing off,” the minister said.

There was a recent fuel shortage in Abuja and numerous other cities throughout the nation.

Although the government stated plans to end fuel subsidies in 2021, the issue in Abuja didn't start until then. In February, a severe scarcity struck big cities like Lagos.

This caused lines at gas stations and prevented millions of people from running their automobiles and the generators they depend on for energy.

When officials tried to replace the off-spec goods nationwide due to the finding of high methanol levels in imported fuel, the shortage increased.

Despite the Federal Government's assurances that it had enough petroleum supplies in stock for distribution, the situation persisted for months.

In Abuja, scarcity persisted "on and off," but black market trade grew.

According to the Association of Distributors and Transporters of Petroleum Products (ADITOP), the current gasoline shortage in the FCT results from the high cost of Automotive Gas Oil (AGO), which is utilised by petroleum tankers, and the low freight rate.

Since then, the Federal Government has raised the freight rate for transporters by N10, a significant rise from N10.46 to an additional N10 to the current N20.46.

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