Nigerians to pay more for petrol in 2013

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There
were strong indications on Friday that the Federal Government would increase
the fuel price in 2013. President Goodluck Jonathan had on
Thursday in Abuja said total fuel subsidy removal was a must. He stated that only total removal of
subsidy on petroleum products would attract investors to the oil sector and end
the importation of fuel.

SUNDAY PUNCH’s investigations have revealed that the
President’s statement was a prelude to another partial deregulation in 2013
because the N971bn fuel subsidy budget for 2013 would not sustain importation
of the product throughout the year.

The amount is N83bn or 9.35 per cent
higher than the N888bn that is currently being spent in the 2012 fiscal year.
It was reliably gathered that
government had opted for a phased deregulation of the downstream sector, which
would lead to a price hike.
Top sources, in the oil industry, who
spoke with one of our correspondents in Abuja, said the hike in fuel prices
next year was “inevitable.”
The sources who pleaded not to be
mentioned because they were not authorised to speak on the matter, said
Nigerians should prepare for the new price regime.
One of the sources said government was
considering two options in 2013.
He said, “It is either the current
fuel scarcity continues or the government embarks on another partial
deregulation, leading to another price increase.
“But from all indications, the
government will go for the second option. Another price increase is inevitable
in 2013.”
On Friday, Jonathan, through his
Special Adviser on Media and Publicity, Dr. Reuben Abati, insisted that, “the
downstream sector of the petroleum industry has to be deregulated; the fuel
subsidy regime is not sustainable and to attract investment into the sector,
there must be fair competition. The subsidy regime does not give room for
efficiency.”
However, Abati, did not mention when
fuel subsidy would be removed.
He said, “The President did not make
any categorical statement on the time the subsidy would be removed.”
Last year, some of the marketers had
invested in the downstream sector with hope that government would embark on
total deregulation in January.
Such marketers have been pushing for
total deregulation.
The Executive Secretary, Major Oil
Marketers Association of Nigeria, Obafemi Olawore, and the Chairman, Depot and
Petroleum Products Marketers Association of Nigeria, Dapo Abiodun, had in
separate interviews last week, called for total deregulation of the sector.
On Friday, marketers told our correspondents
that Nigerians would buy fuel at higher prices in 2013.
Chairman of the Independent Petroleum
Marketers Association of Nigeria, Port Harcourt Unit, Mr. Sunny Nkpe, said
since the President said fuel subsidy was not sustainable, Nigerians should get
ready to pay more for fuel.
“Of course, the price of fuel will
definitely increase,” he said.
Oil marketers under the Jetty and
Petroleum Tank Farm Owners also faulted the N971bn budgeted for the subsidy in
the 2013 fiscal year.
The group said the amount would not be
enough to guarantee adequate supply of petroleum products.
The Executive Secretary, JEPTFON, Mr.
Enoch Kenawa, said this during a telephone interview with our correspondent.
Kenawa said by budgeting N971bn for
fuel subsidy in 2013, the Federal Government would be putting Nigerians in
double jeopardy.
He said, “It (N971bn) will not be
adequate. What the government is doing is putting Nigerians in double jeopardy.
“They said they are subsidising fuel,
yet people can’t see the products to buy and where they have fuel, people still
pay very high to get this product.
“The N971bn for fuel subsidy can never
be adequate. At 35 million litres of fuel consumption per day, the money can’t
be enough.”
He said rather than N971bn, the
government should have provided for between N1.2tn and N1.5tn, based on current
consumption pattern.
He said, “If they want to remove, let
them remove it (subsidy) instead of what they are doing right now.
“Based on the demand, the amount that
would be reasonable for fuel subsidy should be between N1.2tn and N1.5tn.”
The marketers attributed fuel scarcity
in many parts of the country to the N888bn voted for subsidy this year, which
was not enough.
They said the low budget led to
inadequate supply, which caused fuel scarcity in many parts of the country.
Efforts to get the Minister of
Finance, Dr Ngozi Okonjo-Iweala, to react to the marketers’ claim on the 2013
fuel subsidy budget were not successful as calls and text messages sent to her
Senior Special Assistant on Media, Mr. Paul Nwabuikwu, were not replied as of
the time of going to press.
But the minister had in the past
faulted the marketers on the 2012 fuel subsidy budget.
Okonjo-Iweala had insisted that the
N888bn was enough.
Currently, the Nigerian National
Petroleum Corporation is solely responsible for the importation of fuel.
The NNPC spokesman, Mr. Fidelis
Pepple, who had confirmed this to one of our correspondents on Monday, blamed
marketers for the current fuel scarcity.
He said the marketers had not been
selling products, which were supplied to them.
But the marketers faulted him, saying
the fuel imported by the NNPC was inadequate.
In spite of the NNPC’s insistence that
it had imported adequate fuel, there is a shortfall in supply.
Besides, the NNPC, which had abandoned
oil pipelines, is relying on depot owners and marketers for distribution of
fuel.
It would be recalled that government
had in January hiked the pump price of petrol from N65 to N141 but was forced
to reduce the price to N97, following mass protests organised by civil society
groups.
Meanwhile, civil society groups have
told the Federal Government to expect the mother of all strikes if subsidy is
removed.
The  Convener, Save Nigeria
Group, Pastor Tunde Bakare, told our correspondent on the telephone on
Saturday, that the groups were ready to protest.
He said, “The Nigeria Labour Congress
has spoken that it would mobilise civil society groups to go an unprecedented
strike. What Nigeria experienced in January will be a child’s play compared to
what will happen this time.”
Similarly, the Executive Director,
Coalition Against Corrupt Leaders, Mr. Debo Adeniran, said, “Jonathan is not
going to have it easy this time. Let him continue with his plan; we won’t stop
him. But, he won’t be able to stop us when the masses take to the streets and
make the country ungovernable for him.”
The President, Campaign for Democracy,
Joe Okei-Odumakin, also said, “What the government subsidises is corruption. We
are going to use the last drop of our blood to stop the removal. The January
protest will be a child’s play. They should expect the mother of all strikes.
The government has taken us for granted.”
In the same vein, the Executive
Director of Anti-Corruption Network and a former member of the House of
Representatives, Mr. Dino Melaye, stated that, “The plan for total removal of
petroleum subsidy is an invitation to anarchy. I dare the FG to remove total
subsidy. Any attempt to effect total removal of subsidy, we will shut down
Nigeria.”
Activist lawyer, Mr. Femi Falana, also
told SUNDAY PUNCH that Nigerians won’t pay more for
corruption.

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