Nigerians' hope for lower fuel price dashed
Fuel station

The federal government paid the sum of N169.4bn as fuel subsidy in August 2023 to keep pump price at N620 per litre, despite the announced withdrawal of the subsidy regime by President Bola Tinubu.

This is as the price of crude oil in the international market topped $95 per barrel this week.

A document by the Federal Account Allocation Committee (FAAC) seen on Wednesday showed that in August 2023, the Nigerian Liquefied Natural Gas (NLNG) paid $275m as dividends to Nigeria via NNPC Limited. NNPC Limited used $220m (N169.4 billion at N770/$) out of the $275m to pay for the PMS subsidy, while holding back $55m illegally, Daily Trust reports.

The revelation by FAAC effectively indicates that the subsidy is back and NNPC is now taking NLNG dividends to pay the subsidy.

Former President Buhari left the country with the highest amount spent on subsidising petrol in Nigeria’s history.

According to oil and gas industry reports conducted by the Nigeria Extractive Industries Transparency Initiative (NEITI), the cost of petrol subsidy from 2015 to 2020 was N1.99 trillion.

Also reports by the Nigerian National Petroleum Corporation (NNPC) to the Federation Accounts Allocation Committee (FAAC), showed that petrol subsidy cost N1.57 trillion in 2021 alone and another N1.27 trillion from January to May 2022.

The government thereafter budgeted of N3 trillion to cover petrol subsidy costs from June 2022 to June 2023.

An aggregation of the entire costs showed that under President Buhari the government spent N7.83 trillion on petrol subsidies.


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