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By I.A Katagum
- What’s all this hue and cry about the insinuated increase in the pump price of the petroleum motor spirit. Don’t tell me you have not seen it coming right from the day you advocated for the total removal of subsidy on the product!
By the way, seems like most us back then, were just shouting ‘remove subsidy’ ignorantly without actually having a grasp of what the removal entails. Only that can explain some folk’s resolve to come back here and start singing direct opposite of what they sang earlier. (we can not buy fuel above N145/ltr).
The last time I checked, removal of subsidy on a particular commodity will mean the same thing as allowing market forces, notably those of demand and supply to determine the price of that commodity. By that singular act of removing subsidy on petroleum products, the pump price of these products has become vulnerable to changes in the cost of production.
Just like the way increase in the cost of production of rice will cause a proportionate increase in the market price of rice, same phenomenon will also apply to unsubsidized PMS.
Lest I forget, a barrel of crude oil was selling below $30 when the subsidy was first removed, and that was why we were able to buy fuel at a reasonable pump price of N145/Ltr.
Now that the the price of crude oil in the international market has rocketed to about $60/barrel, common sense should be able to tell you that the pump price of N145/ltr is not longer feasible, else the marketers will be running at loss. Without subsidy, there is no way the pump price of petroleum will remain stable. It will always change to reflect prevailing realities.
As it stands now, the government has got only two options. One of the options, frequently adjusting the price to account for any increase or decrease in the cost of production seems not going to be popular with a good number of the populace. And to suddenly make a U-turn and reintroduce subsidy either directly or indirectly will not speak well of the policies of this government.
Personally, I’m not a fan of subsidy. Even when people took to the streets in 2011 to protest the culmination of the subsidy regime by the Jonathan government, my position was clear.
It’s high time the government takes the bull by the horn and make a decisive move to end this menace once and for all.