CBN Reveals How Fuel Price Increased From N87 To N165 Per Litre In Six Years

Data from the Central Bank of Nigeria (CBN) has shown how the fuel pump price increased by 91% in six years.

From December 2015 to  December 2021, the cost of the fuel pump increased from N87 per litre to N165.77, according to the data released by the apex bank.

Following the introduction of the price modulation system by the Federal Government in 2016, the Nigerian National Petroleum Corporation (NNPC) became the country’s sole importer of petrol.

The value of crude oil on the international market rose a few months after the raise in May 2016, but the value of Nigeria’s currency, slite to about N500/dollar, down from roughly N197.

This resulted in a sharp increase in the landing cost of fuel, and the country, unwilling to raise the commodity’s pump price, quickly returned to subsidizing the product.

Before remitting funds to the Federation Account, the NNPC classified the subsidy payments as under-recovery and withheld them from the revenues of domestic crude oil sales.

In 2015, President Muhammadu Buhari appointed himself to the position of substantive Minister of Petroleum.

Before his administration, Buhari had previously disputed the existence of fuel subsidy claiming it was a fraud.

However, Buhari has failed to address the fuel subsidy crisis, which drains government revenue.

The World Bank and the International Monetary Fund have condemned the Nigerian government’s continuous expenditure on the petrol subsidy, demanding it be phased out.

The Nigeria Labour Congress and other pressure groups and trade unions, on the other hand, have promised nationwide protests if the fuel subsidy is removed.

Despite plans to terminate the fuel subsidy by June 2022, the federal government reversed course and extended the subsidy system by 18 months.

Meanwhile, the Nigerian Bar Association, among others, had criticized the APC-led government’s decision to suspend the planned removal of petrol subsidy as an election strategy.

Also, the NNPC has said a total of N4tn from the Federal Government is required to fund the fuel subsidy in 2022.

Recent figures from the NNPC showed that fuel subsidy gulped N675.93bn in the first quarter of 2022.

According to the oil firm, fuel subsidy gulped N210.38bn, N219.78bn, and N245.77bn in January, February, and March 2022 respectively.

Femi Adesina, the President’s Special Adviser on Media and Publicity, claimed earlier this year that Nigerians will have to pay a price to continue subsidizing PMS and that the country may be forced to borrow.

This article was originally published on Nigeria News