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Business News of Tuesday, 30 May 2023


IPMAN warns over fuel subsidy, says fuel price may hit N500 per litre

Fuel pump file image Fuel pump file image

The Independent Petroleum Marketers Association of Nigeria (IPMAN) has said fuel pump price may rise to N500 per litre following the removal of petrol subsidy and the harmonisation of foreign exchange rates by the new government.

Long queues resurfaced in Abuja, Lagos, Port Harcourt, Kaduna, Kano and other cities across the country shortly after newly sworn-in President Bola Tinubu announced the removal of fuel subsidies in his inaugural speech yesterday.

The announcement triggered a rush to filling stations as consumers moved to buy fuel at the current official pump price of N185. The panic-buying led to long queues at some of the petrol stations selling the product.

IPMAN National Operations Controller, Mike Osatuyi told New Telegraph yesterday the subsidy removal would provide oil marketers and importers a level playing field. He appealed to Tinubu to fulfil his promise by channelling the accruals of the subsidy removal to infrastructure and other programmes that will benefit Nigerians.

Osatuyi said: “It (fuel subsidy removal) is a welcome development, we have been saying before. Now that it has been removed, it is going to create a level playing ground for all the marketers, and importers and we are not going to engage in competition which is importation by marketers.

“Talking about the sufferings of Nigerians, we cannot have our cake and eat it. The removal of fuel subsidies will definitely increase the price of petrol. When he (Tinubu) was campaigning he said that from day one, he will remove the fuel subsidy, which he has done today. But the question now is to let them now use it as he has promised to benefit Nigerians.

“Now that he has said he would harmonise the exchange rates and remove the arbitrate, then we should not be looking at forex at N460/$1, we should be looking at forex at about N600 and N700/$1. If that happens, we should not expect anything less than N500 per litre of petrol.”

In Lagos, queues reappeared in such areas as Ikorodu, Ikeja, Victoria Island, Lekki, Onipanu, Ogba, Alimosho, Ojo, Mile 2, FESTAC and many other areas. Information from other states indicated panic buying by petrol users and queues at petrol stations.

It was also learnt that the managers of some petrol stations have shut their retail outlets and refused to sell petrol to anxious buyers who besieged their stations.

A filling station manager, speaks on condition of anonymity, said even though the stock available was subsidised, they were going to pay more to restock since the fuel subsidies had been removed.

He said if they continued to sell at the current rate, they would not make enough money to still buy the same quantity of petrol they bought with the same amount. He said the cost of restocking the same quantity will rise astronomically.

Tinubu said in his augural speech: “On fuel subsidy, unfortunately, the budget before I assumed office is that no provision is there for fuel subsidy. So the fuel subsidy is gone.”