Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari has outlined the heavy cost of fuel subsidies on the country’s economy.
At a stakeholders meeting organised by NNPC on Wednesday, he said the federal government is injecting between N140 billion to N150bn monthly to keep petrol price at N162 per litre, from its actual N256.
“If we are to sell at the market today at current exchange rate, we will be selling the product at about N256 to a litre. What we sell today is N162, so the difference is at a cost to the nation.
“The difference comes back to as much as N140bn to N150bn cost to the country monthly.”
He however said with the high volume of daily consumption, the country cannot sustain subsidy payment.
He noted that smuggling across the borders increased the daily consumption of Premium Motor Spirit (PMS) to 103 million litres per day in May.
But the introduction of Operation White and involvement of the Economic and Financial Crimes Commission (EFCC) had helped the situation, Kyari stated.
“From the truck out report from the PPPRA database, we have seen collapse of load-out average move from 70m litres to 60m litres just in one month; that means we can do with less than 70m, the balance, I don’t know where it goes to but we know for sure that it is not consumed in this country.
“In very recent data, we see what we really want in the beginning of May and June, there was a day, we loaded out about 103m litres of PMS within one day across the depots.”
The Minister of State for Petroleum Resource, Chief Timipre Sylva, said smuggling was not a business and would never be a business.
“When I first came in as minister, I was informed that the daily consumption in the country was around 60 to 62m litres a day, which to me sounded a little bit outrageous considering the number of cars we have on the road .
“But somehow, the figures I understand today, have come down to around 52m litres,” he said