FG Recommences Subsidy On Kerosene
The Federal Government on Thursday, March 17, 2016 commenced the payment of subsidy on kerosene to the tune of N1.17 for every litre of the product consumed across the country.
This development was revealed by the latest data from the pricing templates of the Petroleum Products Pricing Regulatory Agency, Punch reports.
The Federal Government had earlier removed kerosene subsidy and increased the price of the product from N50 to a regulated price of N83 per litre.
Oil marketers who refused to sell at the regulated price were clamped down by inspection officers from the Department of Petroleum Resources.
The Minister of State for Petroleum Resources, Dr. Ibe Kachikwu, however, insisted that the FG never removed the subsidy on kerosene, adding that the government only modulated the prices of the commodities based on the fall in crude oil price in the international market.
The PPPRA is the agency of the Federal Government that fixes and regulates the prices of white products like petrol and HHK, as well as other refined petroleum products across the country.
An analysis of the template on its website on Thursday, March 17, 2016, which was based on Platts’ average prices, revealed that the expected open market price of kerosene at fuel stations run by independent/major oil marketers was N84.17 per litre as against the N83 regulated price.
The PPPRA also stated in its template that the government was making an under recovery of N1.17 on every litre of kerosene consumed in the country; meaning that the commodity is being subsidised to the tune of N1.17 by the government.
The regulatory agency further revealed that kerosene is being subsidised by N0.81 per litre in stations managed by the Nigerian National Petroleum Corporation, NNPC.
The PPRA Assistant Director, Operations, Abuja Zone, Mr. Ahmed Alaku, told newsmen that it was wrong for any dealer to sell above the approved price, adding that the claims by some marketers that they were getting the white products at high rates from depot managers was false.
He said: “If you claim that you buy the product from the depot at more than the regulated government price, there should be evidence.
“You cannot come and say you bought the product at N90 per litre and you are selling at N100 without any evidence.”