Price of fuel price rises along with transport fares
By Jeph Ajobaju, Chief Copy Editor
Fuel subsidy jumped 405 per cent between 2017 and 2018, and then 890 per cent over five years between 2017 and 2021 but pump price only rose 12.1 per cent through the period.
A report by SBM Intelligence – a socioeconomic research firm – titled “Growing fuel prices and transport costs: Which way Nigeria” provides the figures as well as an insight into the highs and lows of intra-city commuting fares.
To keep fuel price down, the government has been forced to continue paying subsidy which has risen over the years, according to SBM.
To keep pump price at N145 in 2017, the Nigerian National Petroleum Company (NNPC) said it spent N144.53 billion on subsidy, but transport cost ranged from N122 to N138.
By 2019, the cost reduced 25 per cent, an insignificant decrease compared with the initial 405 per cent rise.
There was an alarming spike in 2020 as the government incurred N1.192 trillion on subsidy, more than double the cost in 2019.
Over the five-year period, pump price rose 12.1 per cent, subsidy 890 per cent, and transport cost 283 per cent.
The average cost of bus transportation within cities rose from N122.83 in January 2017 to N470.83 in December 2021, the report said.
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Transport fare in 2017
Abuja had the highest intra-city bus transport fare at N290.55. Borno had the lowest at N50.
Transport fare in 2021
Zamfara had the highest intra-city bus transport fare at N700.22. Abia had the lowest at N294.44.
Fuel subsidy by 2021
By 2021, subsidy had gulped N1.43 trillion, a stunning rise of 890 per cent, added the report, as published by Nairametrics.
Fuel subsidy in 2022
The NNPC has requested N3 trillion from the government to fund subsidy in 2022 in the aftermath of Abuja shelving its plan to withdraw subsidy by January 2022 as demanded by the Petroleum Industry Act (PIA) signed into law in August 2021.
The price of petrol has continued to rise through the years due to the pricing template of the now-defunct Petroleum Products Pricing Regulatory Agency (PPPRA).
