Reflections on petrol pump price adjustment BY HAMIDU HOHAMMED

fuelGreat leaders are never sat­isfied with current levels of achievements. They are relent­lessly driven by possibilities and potential achievements’ – Don­na Harrison

True meaning was given to Nigeria’s democracy by the Federal Government with the last downward review of fuel pump price by acceding to the yearnings of the people. The fuel pump price reduction debunked the long held opinion of many Nigeri­ans that it is impossible for prices of goods to come down once they go up.

With uncommon zeal in this sea­son of belt-tightening measures , the Minister of Petroleum Resources, Mrs Alison Diezani-Madueke, rose stoutly in deference to the aspira­tions of many Nigerians penulti­mate week to announce a downward review of pump price of Premium Motor Spirit, PMS, (petrol) thereby demonstrating clearly that the Presi­dent Goodluck Jonathan-led admin­istration has a listening air.

Prior to the announcement of the slash in the per litre price of the prod­uct from N97 per litre to N87, the organized labour, economists and others conversant with the dynamics of the international oil market had strongly called for the downward re­view to reflect the cost of fuel impor­tation as a fiscal imperative.

Rather than hastily acceding to the agitations, the Minister, with her team of experts took the issues be­fore the highest level of government and by her persuasive approach and humane disposition to issues that touch on the welfare of the ordinary Nigerians, she was able to secure government’s approval for a N10 re­duction on petrol pump price to the delight of the citizenry.

Quite remarkably, Mrs Alison- Madueke, has by the latest move once again demonstrated her un­wavering commitment to making the petroleum sector work for the greatest number of the Nigerian people. Though many Nigerians may not necessarily understand the complexities and underground political issues that come into play when the management of the na­tion’s hydrocarbon resources is the matter, the truth is that the Minister has consistently weighed the options and opted for the best whenever the interests of the ordinary Nigerians are concerned.

For those who are familiar with the fiscal position of the Nigerian government consequent upon the prolonged dwindling revenues from crude oil export over the past seven months, the N10 slash in the PMS pump price could be likened to swallowing a dry bitter pill by a government that has continued to grapple with the enormous chal­lenges of macroeconomic stability and improved socio-economic well-being of millions of Nigerians.

Announcing the downward re­view of the pump price at a media briefing on January 18 at the Presi­dential Villa in Abuja, Alison-Mad­ueke said the fiscal measure was ne­cessitated by the reduction in crude oil prices at the international market, but more particularly to demonstrate government’s readiness to act in the interest of the people.

The Minister, who is also the Pres­ident of the Organisation of Petro­leum Exporting Countries (OPEC), noted that crude oil prices had been on decline in the international mar­ket in the past few months and that based on the powers conferred on her by Section 6, Clause one of the Petroleum Act, she had directed the Petroleum Products Prices Regula­tory Agency (PPPRA) and Depart­ment of Petroleum Resources to im­mediately effect the new price from 12 midnight of January 18, this year.

Her words: “Therefore, with the approval and directive of Mr. President and by virtue of Section 6 clause 1 of the Nigerian Petro­leum Act, it is my responsibility as Minister of Petroleum Resources to hereby announce a reduction in the pump price of Petroleum Motor Spirit (Petrol) from the current N97 per litre pump price down to N87per litre pump price, effective from twelve (12) midnight Sunday, 18 of January 2015.

“Accordingly, I have directed the Petroleum Products Pricing Regula­tory Agency (PPPRA) and the De­partment of Petroleum Resources (DPR) to ensure strict compliance of this price adjustment by all market­ing companies”, the minister said.

Beyond the façade of the new pricing regime on petrol lies a fun­damental question. This is, has the reduction of the pump price by gov­ernment in any way affected the general price level? This, to me, is one of the contradictions that should agitate the minds of Nigerians. The issue for concern of many Nigeri­ans is how best to ensure that policy measures do not end at the decision making level but are concrete ben­efits for poor Nigerians, the primary target of such measures.

Ordinarily, one would have ex­pected by now that transporters, traders and other commercial agents would have reflected the slash in the petrol pump price in transport fares and prices of goods and services but two weeks after, nothing seems to have changed in the exploitative tendencies of transporters and sell­ers of goods and services. In other climes, the impact of the fiscal mea­sure would by now be reflecting on general price level. Ironically, this hardly happens in Nigeria.

What this ugly scenario calls for therefore is that the organized labour should rally their members, includ­ing the transporters, to ensure that the benefits of the adjusted pump price of petrol are felt by the masses. To do otherwise will be tantamount to playing the Ostrich by a group that has always pretended to be rep­resenting the interest of the masses but at the same time closing its eyes to the hardships its members are si­lently imposing on hapless and help­less ordinary citizens in the country.

What one is saying here is that rather than returning to the trenches preparatory to another ‘Aluta’ war against the government over what remains a rumoured plan by govern­ment to reduce fuel subsidies this year, the organised labour should show more concern about how the impact of the reduced pump price of petrol will be felt at the grassroots in form of reduced cost of trans­portation and by implication, cost of doing business and living in the country.

By the way, why can’t a govern­ment that has over the past years been relentless in the drive to attract new investments into the down­stream sub-sector of the petroleum industry foresee a reduction in fuel subsidies, especially if the refineries work at optimal capacities? Or is it not implied that if prices of crude oil sustain the present downside for a prolonged period at the international market, subsidies on products will invariably reduce?

Rather than warming up for a war that may never be, the organized la­bour and other patriotic Nigerians should focus their energies on the passage of the Petroleum Industry Bill, PIB, and other areas as a stra­tegic option of finding a lasting so­lution to the problem of products’ importation and by so doing, destroy the very basis of fuel subsidy abuses in the system.


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