The Civil Society Legislative Advocacy Centre (CISLAC) has called on President Bola Tinubu to address the fraudulent regime in petrol pricing in Nigeria following the removal of fuel subsidy. The price of petrol had surged to about N500 per litre since the announcement of its removal.
In a statement issued on Thursday, the Executive Director of CISLAC, Auwal Rafsanjani, urged the new administration to facilitate a critical dialogue that would promote transparency and accountability in the country’s extractive industry.
According to Mr Rafsanjani, “the Petroleum Industry Law is clear that NNPC has no absolute power to be fixing prices without dialogue and having the interests of the poor Nigerians; therefore, the Petroleum Industry Act must be implemented and complied with as a way of stamping out corruption in the extractive sector in Nigeria.”
In addition, the CISLAC recalled that the fuel subsidy regime in Nigeria has long been characterised by elite manipulations and intrigues. According to the statement, no administration has been able to give Nigerians the true picture of what happens in NNPC.
The House of Representatives committee had reportedly revealed that Nigeria’s fuel subsidy scheme cost the country $6.8bn over a three-year period (2009-2011), with NNPC single-handedly responsible for almost half of the siphoned subsidy funds, which was found not to be accountable to anybody or authority. 72 fuel importers, some of whom allegedly had close links to senior government officials, were also singled out.
The CISLAC also noted that “in one case, payments totaling exactly $6.4m flowed from the state treasury 128 times within 24 hours to ‘unknown entities’. Investigators discovered that importers were paid for 59 million liters a day, while the country only consumes 35 million.”
The statement also revealed that in 2012, the pump price of fuel was N65 per litre, against a landing cost of N139, thus the government contributed a N73 subsidy per litre for an annual total of N1.2trillion, or 2.6 per cent of the country’s GDP. According to the Nigeria Extractive Industry and Transparency Initiative, Nigeria spent about N722.3 billion on fuel subsidy in 2018.
The CISLAC disclosed that the NNPC’s financial and operations report for 2019 showed that Nigeria spent N326.43 billion in four months (N104.35 billion, N102.24 billion, N30.64 billion, and N89.19 billion in January, February, March, and April, respectively) in 2019.
The PPPRA also disclosed that the NNPC spent an average of N36.59 subsidizing every litre of petrol imported into the country in November 2019. The NNPC, which is currently the sole importer of petrol in the country, reported that Nigeria consumes between 55 million and 60 million litres of petrol every day. The CISLAC noted that, based on a daily consumption of 55 million litres and an average of N36.59 spent on subsidy per litre, the federal government of Nigeria spent N60.37 billion on subsidizing fuel in November 2019 – an increase of over 2000% when compared with the amount spent on subsidy in the same period in 2018.
