Monday, June 2, 2025
The Lagos Today
  • Login
  • Home
  • Tech
    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

    Stitch Teams Up with Standard Bank’s Shyft for Instant Wallet Top-Ups in South Africa

    Stitch Teams Up with Standard Bank’s Shyft for Instant Wallet Top-Ups in South Africa

    Kenya Takes Action Against TikTok Following Child Exploitation Exposé

    Kenya Takes Action Against TikTok Following Child Exploitation Exposé

  • Startups⚡ by CRAWL
    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    Kenyan Tourism Venture Studio Purple Elephant Ventures Increases Seed Round to $5 Million

    Kenyan Tourism Venture Studio Purple Elephant Ventures Increases Seed Round to $5 Million

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    GIIG Partners with SparkRockets to Launch AI-Powered Startup Validation Tool

    GIIG Partners with SparkRockets to Launch AI-Powered Startup Validation Tool

    Tanzania’s Kilimo BaNDO Revolutionizes Agriculture for Smallholder Farmers

    Tanzania’s Kilimo BaNDO Revolutionizes Agriculture for Smallholder Farmers

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

  • Opinion
  • Business
  • Biotech
  • Industry
    iPhone 16 Sales Surge 20% in China, Signaling a Strong Comeback

    iPhone 16 Sales Surge 20% in China, Signaling a Strong Comeback

    Grid Africa Secures $2.8 Million for Renewable Energy Initiatives in South Africa

    Grid Africa Secures $2.8 Million for Renewable Energy Initiatives in South Africa

    Millennials and Gen Z Show Shorter Tenures Despite Clear Career Paths, New Report Shows

    Millennials and Gen Z Show Shorter Tenures Despite Clear Career Paths, New Report Shows

    Kenya’s Octavia Secures $3.9M Seed Funding to Tackle Carbon Emissions

    Kenya’s Octavia Secures $3.9M Seed Funding to Tackle Carbon Emissions

  • Features & Interviews
  • Entertainment
    • All
    • Art & Design
    • Books
    • Movie
    • Music
    • Sports
    Pick n Pay Set to List Boxer Business in Africa’s Largest IPO of 2024

    Pick n Pay Set to List Boxer Business in Africa’s Largest IPO of 2024

    One Direction Star Liam Payne Dies after Hotel Balcony Fall

    One Direction Star Liam Payne Dies after Hotel Balcony Fall

    It’s important to set boundaries in entertainment industry – Reminisce

    It’s important to set boundaries in entertainment industry – Reminisce

    AFCON 2023: Super Eagles Ready to Face Lions of Cameroon on Saturday – Peseiro

    Flying Eagles moves to Ikenne for camping in prep for 2024 WAFU B U20 Championship in Togo

    EGUAVOEN APPOINTED NIGERIA FOOTBALL FEDERATION TECHNICAL DIRECTOR

    Eguavoen gives conditions for turning Super Eagles interim job to full time role

    Jagun Jagun secures 7 nominations at 2024 AMAA

    Jagun Jagun secures 7 nominations at 2024 AMAA

    Atiku Faults 2020 Budget Review, Urges FG to Prioritize Welfare of Citizens

    Atiku proposes single term of 6-years rotational Presidency

    Oba Elegushi donates 3 standard tennis courts to LASU, reveal reasons behind donation

    Oba Elegushi donates 3 standard tennis courts to LASU, reveal reasons behind donation

    Covid-19: Cinema Operators Decry N22Bn Losses

    FG grants licensing waiver for community cinemas investors – NFVCB

  • Reviews
No Result
View All Result
  • Home
  • Tech
    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

    Stitch Teams Up with Standard Bank’s Shyft for Instant Wallet Top-Ups in South Africa

    Stitch Teams Up with Standard Bank’s Shyft for Instant Wallet Top-Ups in South Africa

    Kenya Takes Action Against TikTok Following Child Exploitation Exposé

    Kenya Takes Action Against TikTok Following Child Exploitation Exposé

  • Startups⚡ by CRAWL
    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    South Africa’s CureRoot Leverages AI to Unlock New Medicines from African Medicinal Plants

    Kenyan Tourism Venture Studio Purple Elephant Ventures Increases Seed Round to $5 Million

    Kenyan Tourism Venture Studio Purple Elephant Ventures Increases Seed Round to $5 Million

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    SA’s Peach Payments Expands into Francophone Africa with PayDunya Acquisition

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    Egypt’s Enza Secures $6.75M to Drive Financial Inclusion in Africa

    GIIG Partners with SparkRockets to Launch AI-Powered Startup Validation Tool

    GIIG Partners with SparkRockets to Launch AI-Powered Startup Validation Tool

    Tanzania’s Kilimo BaNDO Revolutionizes Agriculture for Smallholder Farmers

    Tanzania’s Kilimo BaNDO Revolutionizes Agriculture for Smallholder Farmers

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    South African Prop-Tech Startup Preferental Unveils Innovative Tenant-Screening App

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

    LoftyInc Capital Secures $43 Million for First Close of New Pan-African Seed Fund

  • Opinion
  • Business
  • Biotech
  • Industry
    iPhone 16 Sales Surge 20% in China, Signaling a Strong Comeback

    iPhone 16 Sales Surge 20% in China, Signaling a Strong Comeback

    Grid Africa Secures $2.8 Million for Renewable Energy Initiatives in South Africa

    Grid Africa Secures $2.8 Million for Renewable Energy Initiatives in South Africa

    Millennials and Gen Z Show Shorter Tenures Despite Clear Career Paths, New Report Shows

    Millennials and Gen Z Show Shorter Tenures Despite Clear Career Paths, New Report Shows

    Kenya’s Octavia Secures $3.9M Seed Funding to Tackle Carbon Emissions

    Kenya’s Octavia Secures $3.9M Seed Funding to Tackle Carbon Emissions

  • Features & Interviews
  • Entertainment
    • All
    • Art & Design
    • Books
    • Movie
    • Music
    • Sports
    Pick n Pay Set to List Boxer Business in Africa’s Largest IPO of 2024

    Pick n Pay Set to List Boxer Business in Africa’s Largest IPO of 2024

    One Direction Star Liam Payne Dies after Hotel Balcony Fall

    One Direction Star Liam Payne Dies after Hotel Balcony Fall

    It’s important to set boundaries in entertainment industry – Reminisce

    It’s important to set boundaries in entertainment industry – Reminisce

    AFCON 2023: Super Eagles Ready to Face Lions of Cameroon on Saturday – Peseiro

    Flying Eagles moves to Ikenne for camping in prep for 2024 WAFU B U20 Championship in Togo

    EGUAVOEN APPOINTED NIGERIA FOOTBALL FEDERATION TECHNICAL DIRECTOR

    Eguavoen gives conditions for turning Super Eagles interim job to full time role

    Jagun Jagun secures 7 nominations at 2024 AMAA

    Jagun Jagun secures 7 nominations at 2024 AMAA

    Atiku Faults 2020 Budget Review, Urges FG to Prioritize Welfare of Citizens

    Atiku proposes single term of 6-years rotational Presidency

    Oba Elegushi donates 3 standard tennis courts to LASU, reveal reasons behind donation

    Oba Elegushi donates 3 standard tennis courts to LASU, reveal reasons behind donation

    Covid-19: Cinema Operators Decry N22Bn Losses

    FG grants licensing waiver for community cinemas investors – NFVCB

  • Reviews
No Result
View All Result
The Lagos Today
No Result
View All Result
Home Headlines

Nigerians To Start Buying Petrol at N385

by Eucharia Egwuma
May 21, 2021
in Headlines, National
Reading Time: 7 mins read
0
0
FG Subsidises Petrol by N102bn Monthly
Share on FacebookShare on Twitter

As the Nigerian government, Wednesday, okayed a full deregulation of the downstream sector of the petrol industry, Nigerians are now likely to purchase petrol at N385 per litre.

This is as a result of the government’s attempt to solve the ongoing downstream market deregulation crisis.

The market deregulation means that every aspect of production, refining, distribution and dispensing of petrol is no longer solely financed by the government, which opens the market to competition.

Recall that attempts to remove subsidy on petrol had severally been stalled with the government and organised labour locked in endless negotiation.

However, on Wednesday night, Nigerian governors recommended the immediate removal of petrol subsidy and proposed an over 130 per cent pump price increase, from N162 per litre to between N380 and N408.5.

Mixed Reactions

Stakeholders have raised questions on how the governors arrived at their decisions, adding that the move implies price-fixing, which is against the principle of deregulation.

They are also worried about the impact of such development on the country’s inflation and the purchasing power of Nigerians already affected by the growing devaluation of the naira.

They insisted that the recommended pump price was coming at a time the masses needed more support. They also described the price range as outrageous and lacking in justification.

Others, however, stressed that the move could bring some level of uniform pricing in the West African bloc and stop the smuggling of fuel to neighbouring countries.

Recall that, monthly, over 33 million litres, translating to over N70 billion are being smuggled out of the country.

In March 2020, the Minister of State for Petroleum Resources, Timipre Sylva, announced the deregulation of the downstream sector to commence removal of subsidy, but the labour unions refused, decrying rising inflation and impact on electricity tariff and pump price of petrol.

In March 2021, Petroleum Products Pricing Regulatory Agency (PPPRA) had released a pricing template showing that the retail pump price should range from N209.61 to N212.61 per litre. The template was pegged on an average oil price of $62.22 per barrel for February and an exchange rate of N403.80 to a dollar.

Also, in March, the Group Managing Director, Nigerian National Petroleum Corporation (NNPC), Mele Kyari, said the actual price of petrol should be between N211 and N234 per litre, given the exchange rate and crude oil price.

As at the time of filing this report, crude oil dangles around $66.38 per barrel and the exchange rate on the Central Bank of Nigeria’s (CBN) special window stood at N408 to a dollar.

The indexes, therefore, brought retail pump price in the country to a higher band of about N250 per litre, which is inclusive of extant charges, like bridging fund, wholesalers’ margin, marine transport average, administration charge, transport allowance and retailers’ margin.    

Tax Hike

Following this increase, given that the country’s average actual consumption stands at about 60 million litre daily, the governors would have taxed consumers to the tune of N234 billion monthly.        

Recall that the NNPC had last month announced that it had no funds to contribute to the Federation Accounts Allocation Committee (FAAC) in May, given a huge subsidy (about N120 billion), which is being paid monthly to keep petrol price at N162 per litre.

In the absence of Internally Generated Revenue (IGR) and wrong formalities for resource control, almost all the states in the country rely on the ‘national cake’ from the Federal Government.

Should the states succeed in passing their inability to generate revenue to the masses, the additional petrol tax would have almost doubled the FAAC monthly contribution to the states and local government.

Of the N601.110 billion FAAC that was shared in November 2020, the 36 state governments and the Federal Capital Territory (FCT) received N171.167 billion while the local councils received N126.789 billion.

Raising a red flag, the Head of Retail Investments, Chapel Hill Denham, Ebo Ayodeji, warned that the unavoidable increase in the prices of PMS and electricity would ultimately worsen the inflation rate and the level of poverty.         

Prof. Akpan Ekpo, an economist, also expressed worry that a higher pump price would worsen the already high Nigeria’s misery index, which would escalate social upheavals. He suggested that the declining revenues leave the government with no options than to pull the fuel subsidy plug.

Recall that the federal and state governments are currently battling a serious liquidity crisis with some finding it difficult to pay existing debts just as fresh borrowing sources are becoming scantier. The country’s total public debts as of last December stood at N32.9 trillion.        

Godwin Owoh, another professor of economics, pointed out the governors’ recommended price was as faulty as the NNPC-estimated landing cost, as the process of computation was not transparent.

While many have suggested that the governors’ recommendation was motivated by the urgent need to increase public revenues, he said it was faulty to leave the price of essential and extremely inelastic commodities completely to the dictate of market forces.

Even though he admitted that the government’s lean revenue cannot continue to accommodate fuel subsidy, he said the solution to the country’s challenge was “not in getting more revenues” but blocking the historical leakages.

“What is the point in getting more revenue when it will end up in the pockets of politicians? We must block the corruption avenues and make governance more transparent,” he said.

The Chairman of the International Energy Services Limited (IESL), Dr. Diran Fawibe, also noted that the price suggested by the governors is unrealistic, adding, “the governors can’t be dictating a particular price, what they should do is to give support to the NNPC to achieve a deregulated sector.”

According to him, if the price is increased it will not amount to deregulation but price fixing to end subsidy, suggesting further that the governors may be doing that because of the effects of subsidy on government revenue.

While calling for the need to locally refine crude oil, Fawibe said deregulation of the downstream sector requires other features than the pump price of petrol.

“What the government is currently paying as subsidy is not sustainable in the long term. This fact is staring the governors in the face, that is why they are now talking about the price of petroleum products. But they should have come out much earlier to give support to the federal government in removing subsidies,” Fawibe said.

He noted that the governors would have engaged labour unions and civil society organisations to be reasonable on the matter, adding that people must not use a particular product to hold the economy by the horn by paying the outrageous amount.

A former lead at the Facility for Oil Sector Transparency and Reform (FOSTER), Henry Adigun, did not see sense in the governors’ plan, adding that the development will lead to inflation.

He noted that while the governors were thinking of introducing taxes on the product, the variance remained very elusive. President of the Nigerian Association for Energy Economists (NAEE), Prof. Yinka Omorogbe, said the governors have no business in fixing the pump price of the product. She equally questioned the rationale for the suggested price if the landing cost hovers around N250 per litre.

Omorogbe said: “I think we need more information and that the government needs to be fully transparent in this matter. The present opaque situation should not be replaced by another type of opacity. What will be the composition of the new price?”

An energy expert, Michael Faniran, said: “The Governors’ Forum can only support deregulation and removal of subsidy, they should not be suggesting any price to be paid by consumers.”

According to him, deregulation goes beyond the removal of government subsidies and requires the creation of a competitive market environment, which will guarantee the supply of products at commercially efficient prices to customers.

Faniran noted also that deregulation should not be about fixing product prices but ensuring transparency of the components of the prices that consumers pay at the pump.

“Pump prices should be dictated by market forces but with the protection of consumers by the necessary agencies of government. The prices should be allowed to move based on the dynamics across the value chain,” the expert said.

Share this:

  • Facebook
  • X

Like this:

Like Loading...
Tags: Nigeria
Previous Post

Lagos Proposes $2.5bn on 4th Mainland Bridge Construction

Next Post

Boko Haram Leader, Shekau, Commits Suicide After ISWAP Invasion

Eucharia Egwuma

Eucharia Egwuma

Related Posts

NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

NjiaPay: South African Fintech Startup Reshaping Payment Solutions for African Businesses

by Iyanu Ale
May 5, 2025
0

In a move poised to transform how African businesses manage financial transactions, South African fintech startup NjiaPay is streamlining payments...

Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

Ghana’s Kofa Secures $8.1M Pre-Series A Funding to Drive Clean Energy Access Across Urban Africa

by Iyanu Ale
May 2, 2025
0

Ghanaian energy tech startup Kofa has successfully raised $8.1 million in a pre-Series A funding round to scale its AI-powered...

Next Post
Boko Haram Leader, Shekau, Commits Suicide After ISWAP Invasion

Boko Haram Leader, Shekau, Commits Suicide After ISWAP Invasion

Please login to join discussion

Recommended

Labour Rejects FG’s N54,000 Proposed Minimum Wage, Insists on N615,000

Labour Threatens Strike Over Minimum Wage: Rejects N62,000, Demands N250,000

12 months ago
Game-changing type 1 diabetes drug approved in US

Game-changing type 1 diabetes drug approved in US

3 years ago

Popular News

    Connect with us

    Tags

    #EndSARS 2023 Elections 2023 polls 2023 Presidency ACCIDENT Africa All progressives Congress APC Asiwaju Bola Tinubu Babajide Sanwo-Olu CBN Central Bank of NIgeria Central Bank of Nigeria (CBN) Coronavirus pandemic Covid-19 Covid-19 in Lagos Covid-19 in Nigeria Covid-19 Vaccine Cryptocurrency Economic and Financial Crimes Commission EFCC Federal Government Federal Government of Nigeria Fraud Gov. Sanwo-Olu House of Representatives Lagos-Ibadan expressway Lagos state Lagos State Government Lagos State House of Assembly Lagos State Police command Muhammadu Buhari Murder Naira NDLEA Nigeria Nigeria Customs Service Nigerian Economy Nigeria Police Force Rape Strike action TECH UK United Kingdom US

    News

    • Industries
    • National
    • Startups
    • Biotechnology

    Opinion

    • Editorials
    • Today’s Opinion
    • Letters
    • Sunday Review
    • Advertise
    • Opinion
    • Features & Interviews
    • Investigation
    • Contact

    © 2020 The Lagos Today - Nkali.

    Welcome Back!

    Login to your account below

    Forgotten Password?

    Retrieve your password

    Please enter your username or email address to reset your password.

    Log In
    No Result
    View All Result
    • Tech
    • Business
    • Biotech
    • Startups
    • Entertainment
    • Feature & Interviews
    • Reviews
    • Opinion

    © 2020 The Lagos Today - Nkali.

    %d