There were strong indications on Friday that the
Federal Government would increase the fuel price in 2013.
President Goodluck Jonathan had on Thursday in Abuja
said total fuel subsidy removal was a must.
He stated that only total removal of subsidy on
petroleum products would attract investors to the oil sector and end the
importation of fuel.
SUNDAY PUNCH’s investigations
have revealed that the President’s statement was a prelude to another partial
deregulation in 2013 because the N971bn fuel subsidy budget for 2013 would not
sustain importation of the product throughout the year.
The amount is N83bn or 9.35 per cent higher than the
N888bn that is currently being spent in the 2012 fiscal year.
It was reliably gathered that government had opted for
a phased deregulation of the downstream sector, which would lead to a price
hike.
Top sources, in the oil industry, who spoke with one of
our correspondents in Abuja, said the hike in fuel prices next year was
“inevitable.”
The sources who pleaded not to be mentioned because
they were not authorised to speak on the matter, said Nigerians should prepare
for the new price regime.
One of the sources said government was considering two
options in 2013.
He said, “It is either the current fuel scarcity continues
or the government embarks on another partial deregulation, leading to another
price increase.
“But from all indications, the government will go for
the second option. Another price increase is inevitable in 2013.”
On Friday, Jonathan, through his Special Adviser on
Media and Publicity, Dr. Reuben Abati, insisted that, “the downstream sector of
the petroleum industry has to be deregulated; the fuel subsidy regime is not
sustainable and to attract investment into the sector, there must be fair competition.
The subsidy regime does not give room for efficiency.”
However, Abati, did not mention when fuel subsidy would
be removed.
He said, “The President did not make any categorical
statement on the time the subsidy would be removed.”
Last year, some of the marketers had invested in the
downstream sector with hope that government would embark on total deregulation
in January.
Such marketers have been pushing for total
deregulation.
The Executive Secretary, Major Oil Marketers
Association of Nigeria, Obafemi Olawore, and the Chairman, Depot and Petroleum
Products Marketers Association of Nigeria, Dapo Abiodun, had in separate
interviews last week, called for total deregulation of the sector.
On Friday, marketers told our correspondents that
Nigerians would buy fuel at higher prices in 2013.
Chairman of the Independent Petroleum Marketers
Association of Nigeria, Port Harcourt Unit, Mr. Sunny Nkpe, said since the
President said fuel subsidy was not sustainable, Nigerians should get ready to
pay more for fuel.
“Of course, the price of fuel will definitely
increase,” he said.
Oil marketers under the Jetty and Petroleum Tank Farm
Owners also faulted the N971bn budgeted for the subsidy in the 2013 fiscal
year.
The group said the amount would not be enough to
guarantee adequate supply of petroleum products.
The Executive Secretary, JEPTFON, Mr. Enoch Kenawa,
said this during a telephone interview with our correspondent.
Kenawa said by budgeting N971bn for fuel subsidy in
2013, the Federal Government would be putting Nigerians in double jeopardy.
He said, “It (N971bn) will not be adequate. What the
government is doing is putting Nigerians in double jeopardy.
“They said they are subsidising fuel, yet people can’t
see the products to buy and where they have fuel, people still pay very high to
get this product.
“The N971bn for fuel subsidy can never be adequate. At
35 million litres of fuel consumption per day, the money can’t be enough.”
He said rather than N971bn, the government should have
provided for between N1.2tn and N1.5tn, based on current consumption pattern.
He said, “If they want to remove, let them remove it
(subsidy) instead of what they are doing right now.
“Based on the demand, the amount that would be reasonable
for fuel subsidy should be between N1.2tn and N1.5tn.”
The marketers attributed fuel scarcity in many parts of
the country to the N888bn voted for subsidy this year, which was not enough.
They said the low budget led to inadequate supply,
which caused fuel scarcity in many parts of the country.
Efforts to get the Minister of Finance, Dr Ngozi
Okonjo-Iweala, to react to the marketers’ claim on the 2013 fuel subsidy budget
were not successful as calls and text messages sent to her Senior Special Assistant
on Media, Mr. Paul Nwabuikwu, were not replied as of the time of going to
press.
But the minister had in the past faulted the marketers
on the 2012 fuel subsidy budget.
Okonjo-Iweala had insisted that the N888bn was enough.
Currently, the Nigerian National Petroleum Corporation
is solely responsible for the importation of fuel.
The NNPC spokesman, Mr. Fidelis Pepple, who had
confirmed this to one of our correspondents on Monday, blamed marketers for the
current fuel scarcity.
He said the marketers had not been selling products,
which were supplied to them.
But the marketers faulted him, saying the fuel imported
by the NNPC was inadequate.
In spite of the NNPC’s insistence that it had imported
adequate fuel, there is a shortfall in supply.
Besides, the NNPC, which had abandoned oil pipelines,
is relying on depot owners and marketers for distribution of fuel.
It would be recalled that government had in January
hiked the pump price of petrol from N65 to N141 but was forced to reduce the
price to N97, following mass protests organised by civil society groups.
Meanwhile, civil society groups have told the Federal
Government to expect the mother of all strikes if subsidy is removed.
The Convener, Save Nigeria Group, Pastor Tunde
Bakare, told our correspondent on the telephone on Saturday, that the groups
were ready to protest.
He said, “The Nigeria Labour Congress has spoken that
it would mobilise civil society groups to go an unprecedented strike. What
Nigeria experienced in January will be a child’s play compared to what will
happen this time.”
Similarly, the Executive Director, Coalition Against
Corrupt Leaders, Mr. Debo Adeniran, said, “Jonathan is not going to have it
easy this time. Let him continue with his plan; we won’t stop him. But, he
won’t be able to stop us when the masses take to the streets and make the
country ungovernable for him.”
The President, Campaign for Democracy, Joe
Okei-Odumakin, also said, “What the government subsidises is corruption. We are
going to use the last drop of our blood to stop the removal. The January
protest will be a child’s play. They should expect the mother of all strikes.
The government has taken us for granted.”
In the same vein, the Executive Director of
Anti-Corruption Network and a former member of the House of Representatives,
Mr. Dino Melaye, stated that, “The plan for total removal of petroleum subsidy
is an invitation to anarchy. I dare the FG to remove total subsidy. Any attempt
to effect total removal of subsidy, we will shut down Nigeria.”
Activist lawyer, Mr. Femi Falana, also told SUNDAY
PUNCH that Nigerians won’t pay more for corruption.