Speaking during a Breakfast Business Lecture organised by the Island Club tagged: “Petroleum Industry Bill: Challenges and Opportunities,” the Commissioner for Energy in Lagos State, Mr Wale Oluwo, while delivery his address as the Chief host, he argued that the PPPRA has no business regulating the price of petroleum products.
He said the issue of regulating the downstream sector will be addressed by the recently passed Petroleum Industry Governance Bill (PIGB) by the Senate.
“If you must regulate the price, you must ensure that you have a very deep pocket to subsidise these products. If you don’t have deep pocket, the market will help you by creating a black market that sets a price that suits itself. I don’t belong to the school of thought that says prices that go up will not come down.
“Prices do come down as long as there is competition. I like the PIGB and we will like to see more reforms in oil and gas. It is in Nigeria that I see products and commodities that are characterised by inelastic demand and for which we can’t have close substitutes to be subsidized by the government,” he said.
He posited that these are markets and products which the private sector should be pursuing and falling over themselves.
“So our problem is structural and we must continue to handle it from the structural correction perspectives. In Nigeria, we subsidise all commodities including electricity, gas, petrol, interest rates, foreign exchange etc,” he said.
However, he congratulated the Island Club for the business meeting and argued that Lagos State Government will take advantage of the rare oil discovery in Dahomey basin as against the usual Niger Delta discoveries.
“Our interest is not in oil but in gas. We need gas to power Lagos economy. Our programme centred on power generation that will be off-grid,” he said.
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