By Nnamdi Nwigwe
The Group Managing Director (GMD) of the Nigerian National Petroleum Corporation (NNPC), Mallam Mele Kyari, recently announced, with so much chest beating, that the controversial petroleum products subsidy has been abolished “for ever.”
To many Nigerians who believe that the subsidy regime has never been necessary but for the benefit of the anointed few who had been feeding fat from it, the decision is laudable. The announced complete abrogation may not be welcome to such people but for the economic health of Nigeria, it was long overdue.
Now the question remains if the Federal Government was convinced that it was now time to withdraw subsidy that even the President promised to do during his campaign for election in 2014 but which he conveniently forgot when he came into office.
The naked truth is that subsidy could no longer be explained away when the price of crude is hovering between $20 and $30 per barrel, a far cry from the $55 to $60 that advised our 2020 budget.
Buyers of our crude, in the words of the NNPC boss, “are now roaming the high seas in search of customers.”
But the hook in this new policy of subsidy withdrawal lies in the future when the crude price bouces back. Will Mallam Kyari live up to his words, especially when the sharks swim back to their locations? He even assured that from now onwards the price of the country’s petroleum products, including the Premium Motor Spirit, PMS, aka Petrol, will henceforth be guided by “market forces.”
Can it really?
How can we reconcile “market forces” with the “price equalization” policy? They appear to be a contradiction in terminology.
Can political arithmetic be removed from the mix at the appropriate time?
Meanwhile, let’s not be carried away by the inevitable withdrawal of the corruption-filled scam called “fuel subsidy” and forget the litany of cases in court and under investigation related to the scandal over multi-million Naira subsidies paid already for fuel not delivered.
Subsidy removal sounds sweet now that even pump prices of petrol have come down to N123.50 from N145. One hopes that the Information and Public Relations Departments of NNPC are kitting up to educate and prepare consumers that “market forces” and “subsidy removal” are real and could lead to our pump price of the popular petrol rising up to over N250 per litre.
Watch the gift of the Greeks.
Mazi Nnamdi Nwigwe, a veteran journalist, wrote in from Owerri
