Kachikwu And Call For Fuel Price Hike | Independent Newspapers Limited
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Kachikwu And Call For Fuel Price Hike

crude oil; fuel price
Posted: Sep 13, 2016 at 5:48 am   /   by   /   comments (0)

By Ikechi Nzeako.

 

LAGOS – Petroleum products are the fulcrums on which all economies, including Nigeria’s, run.

The prices of the products are falling in many countries because of the decline in crude oil price in the international oil market. But this is not the case in Nigeria, as the price of fuel has been on the rise in the last five years. This is so because Nigeria does produce crude and does not refine it and, loses all the by-products of petroleum.

Nigerians are demanding cut in the price of fuel on the argument that the price of crude is falling.

However, former Group Managing Directors (GMDs) of the Nigerian National Petroleum Corporation (NNPC) last week called for an upward review of the price of petrol, saying that the present price cap of N145 per litre is not in line with current economic realities.

According to a statement by the NNPC, the former GMDs stated this at a meeting with the Group Managing Director of the NNPC, Dr. Maikanti Kacalla Baru, and the immediate past GMD and current Minister of State for Petroleum Resources, Ibe Kachikwu, in Abuja. The former GMDs said the petrol price cap of N145 per litre was not congruent with the liberalisation policy, especially with the foreign exchange rate and other price determining components such as crude cost, port charges, among others, remaining uncapped.

The history of fuel price hike in the country is an unsavoury one as it is full of intrigues, struggles, protests, police and military actions, and even deaths.

However, the reaction to the call was swift and savage. In his reaction, Sen. Abdullahi said if the former NNPC bosses had been up to their responsibilities, Nigeria would not be importing refined petrol today.

Abdullahi also warned the government against accepting the proposal of the GMDs.

The reaction of a vast majority of Nigerians followed this path; they argued that another hike in the price of petrol would lead to suffering and inflation in the country.

However, the federal government has denied that it planned to increase the price of petrol. Speaking on the issue, Kachikwu assured Nigerians that the price would remain at the current level, despite the dwindling fortunes of the naira in forex market.

But Nigerians are apprehensible following the call; this is so because of the power, influence, authority and reach the proponents of call for price increase can wield. Some argued that the government might be testing the waters, wanting to know the reaction of the people if there was a petrol price hike.

The position of analysts and expert in the oil industry is that a hike is inevitable because of the forex situation in the country.

Will there be a petrol price hike in the country? Time will tell.