The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has alleged that the Federal government is still paying subsidy on petrol.
This is contrary to the pronouncement of President Bola Tinubu in his inaugural speech, where he declared that the subsidy era was gone.
The National President of PENGASSAN, Festus Osifo, who also doubles as the President of Trade Union Congress of Nigeria (TUC), made the claim while appearing on Channels Television’s Politics Today on Friday night.
According to Osifo, due to the cost of crude oil in the international market and the dollar to Naira rate, the government still pays subsidy for the product.
‘They [government] are paying subsidy today.”
Osifo said: “In reality today, there is subsidy because as of when the earlier price was determined, the price of crude in the international market was somewhere around $80 for a barrel. But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, then the price [of petroleum] also needed to move.”
For the government to stop subsidising petroleum, he said two things must happen.
“The only reason the price will not move is when you are able to manage your exchange rate effectively and you are able to pump in supply and bring down the exchange rate.
“So, if the exchange rate comes down today, we will not be paying subsidy. But with the exchange rate value and the price of crude oil in the international market, we have introduced subsidy,” Osifo maintained.