MOMAN Cautions over Partial Return to Subsidy
Major Oil Marketers Association of Nigeria (MOMAN) has pleaded caution on the part of the federal government not to return subsidy on petroleum products. This move to partially return subsidy by the government is said to be understandable given the need to curb rising cost of Premium Motor Spirit (PMS) otherwise known as petrol.
MOMAN pointed out that the short-term intervention must be targeted, affordable, well thought out, and time-bound, and should not negatively impact the Nigerian economy in the long run.
Chief Executive Officer and Executive Secretary of MOMAN, Clement Isong, disclosed this, while speaking on ‘Energy Transition, PIA, Petroleum Pricing, and the Way Forward in the Downstream Sector’ at the Nigeria Association of Energy Correspondents (NAEC) International Strategic Conference 2023 in Lagos, yesterday.
He explained: “Deregulations are meant to enable people and businesses. Therefore, there is a need for right decisions to be made based on resources available. When commodity pricing is right, this would serve as a confidence booster for the sector. If spending goes down, the industry should reduce its costs; people should consider the use of alternative energies available.”
He further revealed that petrol prices will continue to increase based on market dynamics and cost of crude oil. He added that increase in prices will force petroleum product consumers to be more efficient in energy usage and choices of fuel type.
Also, Chief Executive Officer, Nigerian Upstream Petroleum Regulatory Commission (NUPRC), Gbenga Komolafe, disclosed Federal Government’s commencement of moves to ensure drastic reduction in cost of crude oil production.
He said the commission is committed to ensuring significant reduction in cost of doing business in the upstream petroleum industry.
“Following in-depth comparative analysis between Unit Operating Cost (UOC) in Nigeria and that obtainable in other climes, we have commenced the development of cost studies and benchmarks, to ensure improvement in cost efficiency of our upstream petroleum operations, in accordance with Section 8 of the Petroleum Industry Act 2021(PIA),” he said.
Meanwhile, marketers of petroleum products in Abuja, yesterday, asked for dollar subsidies that would enable them to import products at N600/$.
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With diesel and aviation fuel already skyrocketing above N1,000 per litre, the marketers insisted that unless urgent action is taken, businesses are heading for total collapse in the downstream segment of the nation’s petroleum industry.
The marketers, under the umbrella of Natural Oil and Gas Suppliers Association of Nigeria (NOGASA), said although removal of subsidy on premium motor spirit is laudable, steps that would improve the market are lacking.
