For the first time this week, the Nigerian National Petroleum Company Limited (NNPCL) confirmed that it was facing financial constraints in footing fuel imports. By that singular action, the company threw a beam of illumination and opened up on its operations. Many Nigerians, including yours sincerely, became wary when the NNPCL, in its 2023 audited report, disclosed that the presidency had approved over N3 trillion to cover petrol importation shortfalls.
The Reality
When the privatised national oil company revealed that it was faced with serious financial constrictions, even to the undiscerning mind, the grim consequences became obvious. If Nigerians were suspicious of oil subsidy payments in the past, it’s now crystal clear that fuel subsidy has become a recurring term in the nation’s lexicon. Though petrol subsidy has transmuted in various applications, the amoebic nature it demonstrates is linked to the exigencies of the times.
Before Major-General Muhammadu Buhari ascended the presidency in May 2015, he was known to have likened subsidy payment to daylight robbery that was deliberately done to fleece the public purse. By the time he was completing his presidency in May 2023, Buhari signed a budget that provided a whopping sum of N3. 6 trillion in oil subsidies from January to June of the same year.
Last year, the citizens were served the bread of hope that the nation’s moribund refineries were set to resume operations. With the completion of Dangote Refinery, not a few hoped that, at last, the long night of fuel scarcity was set to be replaced with a new dawn of fuel abundance. When queues began to stretch long distances at most filling stations in various parts of the country last week, the fear of yesterday crippled many. After confirmation of the Reuters’ report that the NNPCL was owing its trading partners over fuel imports, it turned out to be an opportunity for thousands of human filling stations to have their pound of flesh. Though most of the fuel stations were closed, these human filling stations poured into the streets with abundant fuel in their jerry cans.
Ugly Truths
Complete deregulation of the oil sector may be a good idea, but it is obvious that the Nigerian economy is not strong enough to survive the prevailing economic hardship caused by the increase in fuel price. Subjecting the determination of petrol price to the forces of demand or supply amounts to enthroning an unfair system that preys on the economically vulnerable. The government must provide a safety valve against incessant changes in fuel prices due to instability in the global oil market and restrain the ravenous greed of business outfits on a weak citizenry.
Taking into cognisance present realities, the cost of fuel in Nigeria will always be far cheaper than in neighbouring countries. As the hope of the common man against economic predators, the government can’t afford to allow for total deregulation of the oil sector that provides oxygen to the economy. A situation where over 15 million litres are smuggled out of Nigeria on a daily basis makes it imperative to close down loopholes that undermine economic growth. Must we give up and allow a litre of fuel to be sold at N1,800 per litre in the country simply because the same cost is charged in Ghana, Benin or Chad?
Nigeria is where it is today due to data deficits over what actually constitutes our daily fuel consumption rate. The daily fuel consumption rate, which hovers between 66 million to 54 million litres, has always been a subject of debate. What the government needs to do is, first of all, sieve the wheat from the chaff in order to come up with the real data on our country’s daily fuel requirement. If developed countries are willing to provide some forms of subsidies to their citizens, then, I see nothing wrong in doing the same for Nigerians.
Shortfalls Or Subsidy?
From what we have seen and witnessed since the beginning of this week, doing away with the subsidy regime that provides funds to cover shortfalls in petrol cost for the citizens may prove daunting in the short-run than in the long-run. The Tinubu-led administration should come up with templates that provide cheaper petrol for the citizens devoid of the corruption of the subsidy regime. When fuel prices shoot beyond the purchasing power of Nigerians, the inevitability of public revolt becomes real.
Sacking the NNPCL group chief executive officer (GCEO), Engr. Mele Kyari, may not change anything. What is needed now is to confront the monstrous corruption that threatens not only the oil sector, but also the Nigerian system. Surviving the present hardship that is now becoming increasingly herculean should serve as a wake-up call on the federal government to quickly provide measures and salvage the distressed citizens from preventable suffering caused by the strangulating cost of fuel.
In the face of seething public repugnance over rising fuel cost and its concomitant consequences, the federal government must walk its ‘Renewed Hope’ agenda. The poor must not be punished for the failure of the system to rein in the fraud of the corrupt few. Whatever happens in the coming days, Tinubu should note that the government is for the security and welfare of the people. The president should intervene so that the populace can survive the current hardship desolating Nigerians.