Gabriel Ogbechie, the CEO of Rainoil Limited, asserted during the Stanbic IBTC Energy and Infrastructure Breakfast Session held in Lagos on Tuesday that the federal government has resumed fuel subsidy payments due to the devaluation of the Naira in the foreign exchange market.
He highlighted that Nigeria’s daily fuel consumption stands at 40 million liters, and with the foreign exchange rate at N1,300, the government’s subsidy per liter ranges between N400 and N500, totaling approximately N600 billion monthly.
Ogbechie recalled that when President Buhari took office in May the previous year, he announced the end of the fuel subsidy. However, shortly afterward, the exchange rate depreciated, leading to the reemergence of the subsidy.
As the exchange rate continued to rise, reaching N1,300, the subsidy on petrol became evident. He emphasized that with the Nigerian National Petroleum Corporation (NNPC) being the sole importer of petrol, subsidized pricing remains in place.
Former Kaduna State governor, Nasir El Rufai, also commented that the federal government is now spending more on petrol subsidy than before.
Additionally, the Special Adviser to the President on Energy, Mrs. Olu Veŕheijen, affirmed that while the subsidy was officially removed in May, the government retains the authority to intermittently intervene to stabilize prices and address social unrest caused by inflation and exchange rate fluctuations. She emphasized that such interventions do not negate the removal of the subsidy.
