FUEL marketers have proposed an increase of fuel price to N165 per litre, citing forex challenges, especially scarcity of foreign exchange to finance Premium Motor Spirit (PMS) importation and high exchange rate, which had been sending them out of business.
This was as the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) and the Nigeria Union of Petroleum and Natural Gas (NUPENG) have warned against any increase in pump price of PMS, popularly referred to as petrol, at this critical time.
PENGASSAN and NUPENG posited that “as much as we are starred in the face with the above facts, we believe that this is not the right time to review the pricing template of PMS.”
The unions made the position known in a joint position paper presented to the ad hoc Committee on Review of Pump Price of Premium Motor Spirit, at the House of Representatives, on Monday.
The unions stated that further review of petrol price should not be contemplated now, based on the present economic situation in the country.
They said: “The economy is biting hard on all Nigerians. Any attempt to further review the template will further impoverish ordinary Nigerians, as the additional price will be transferred to the end users of the product. Such review will further impact negatively on the economy, which the government is trying to pull out of recession.
“PMS is a stable product in Nigeria and if there is any increase in its price, it will definitely drive up the inflation index. Nigeria depends on PMS, for not only transportation, but also to generate power for either home or industrial use, especially the Small and Medium Enterprises (SMEs) which can jumpstart the nation’s economy.
“As major stakeholders in the oil and gas industry, we supported the review of the pricing template that moved the price of PMS to N145 per litre on the condition that the government will put in place some palliative measures and reinvest the gains from that price regime to cushion effects of the increase.”
The unions urged the government to provide transportation system, which should include rehabilitation of the rail system, good and motorable road networks, among others.
As part of the palliatives, PENGASSAN and NUPENG called for upward review of workers’ wages to meet the reality of the increment and rejuvenation of the power sector for efficient and effective electricity supply to enhance performance of the real sector, especially the SMEs and other manufacturing companies that are affected by the epileptic power supply.
They also called for provision of good health care system and stressed the need to enhancing local refineries, adding that this was key to the development of the downstream sector and the deregulation policy of the government.
According to the unions: “The Minister of State, Petroleum Resources, Dr Ibe Kachikwu, said some time ago, the nation’s four refineries in Port Harcourt 1 and 2, Kaduna, Warri had attained a combined daily production of about 6.76 million litres of petrol per day. This is still not what is expected from the local refineries.
“We have, on several occasions, demanded that the government must ensure optimal performance of the existing four state-owned refineries in Port Harcourt, Warri and Kaduna and also put in place machinery for the construction of new refineries in the country to ensure adequate production for domestic consumption and possible export.
“The refineries’ epileptic state has given room for massive importation of petrol which is a big weight on our foreign exchange. For us to stop exporting jobs outside our shores, the nation’s four refineries must be made to work optimally and that will go a long way in reducing the heavy cost incurred on importation of petrol.
The unions called for an all-embracing stakeholders’ forum to look into the issue.
The unions added: “In the mean time, to resolve recent price crisis, the Federal Government should give forex concessions to oil marketers to enable them import petroleum products and make their margin.
“The change mantra of President Muhammadu Buhari harps on job creation and not job losses. In this regard, forex concession should be given to oil marketers to make it easy for them to import PMS, so that they can make profit and keep their workforce.
“We also call on government to reduce the sundry charges created by some bodies controlled by government. For instance, NPA charges, NIMASA charges and storage charges, as they will go a long way to push down the landing cost.”
Petrol price increase fraudulent —Reps
Earlier, Chairman of the ad hoc committee, Honourable Raphael Nnanna Igbokwe, in his opening address, noted that the people were concerned with the general increase in prices of goods and services partly due to the increase of petrol to N145 per litre.
According to him, “can Nigerians be paying the cost of capital by importers and dealers? Can Nigerians be paying for lathering services when there are agencies whose duties are to dredge our seas? How effective and transparent is the bridging claims?”
The lawmaker said though the increase was said to eliminate payment of subsidy by government and the attendant fraud, justification have to be given on the N145 being charged and if Nigerians were getting value from the agencies who earned income from the price template of petrol.
Igbokwe accused a number of government agencies of contributing to the astronomical price of petrol which was presently causing Nigerians pains and suffering.
Fuel now N155 per litre in Kano
The situation is now having effect in Kano State, as some fuel marketers have increased the price of the commodity from N145 per litre to between N153 and N155 per litre.
The News Agency Nigeria (NAN) reported that the situation was worse outside the state capital, as a litre of the commodity in some local government areas of the state now cost more than N155.
A correspondent of NAN, who went round the city of Kano on Monday, reported that while most of the filling stations remained closed, the few ones operating had long queues of vehicles.
Following the development, socio-economic activities had been partially paralysed, especially in the state capital.
Black marketers in the city had started exploiting the situation by increasing their prices from N750 per four- litre gallon to between N850 and N900 for same quantity.
Commercial tricycle operators had also increased their fares from the usual N50 per drop to between N80 and N100 per drop, depending on the distance.
NAN recalled that the trend started on Friday, when Kano residents found most of the filling stations closed.
The marketers were said to have closed the filling stations in anticipation of fuel price increase which had since been denied by the Federal Government.
Chairman of Independent Petroleum Marketers Association (IPMAN), Alhaji Bashir Dan-Mallam, could not be reached, while spokesman of the Department of Petroleum Resources (DPR) in Kano State, Paul Jehzi, said a task force to check hoarding and the sale of fuel above the approved price of N145 had been constituted.
According to him, the task force had started going round the filling stations to check the excesses of some of the marketers bent on causing artificial scarcity in the state.