Friday, September 24, 2021

NNPC’s petrol subsidy lies, NGF’s transferred aggression

Nigerian politicians have a penchant for transferring their aggression to the country’s inconsequential majority toiling below poverty line. They are voiceless and powerless in the face of the transferred aggression. That makes them a cheap target for the politicians’ gambit.

Last week the Nigeria Governors Forum (NGF) made a recommendation that amounted to transferring aggression to the voiceless and powerless majority. The Governors forum recommended a petrol pump price that would push millions more below poverty line.

Despite the recent rise in crude oil price, the federal government decreed a minimum petrol pump price of N162 per liter.

The governors’ forum is worried about fraudulent claims by the Nigerian National Petroleum Corporation (NNPC) that Nigeria consumes 93 million liters of petrol per day. NNPC deducts subsidy on that basis and dumps whatever is left from crude oil sales, in the federation account. The NGF knows NNPC’s antics, but no one has the courage to challenge that criminal act.

Consequently, the governors’ forum wants not only the withdrawal of petrol subsidy, but an artificial pump price that would forestall smuggling of petrol to Nigeria’s tiny neighbours to the west.

Kayode Fayemi, Ekiti state governor and chairman of the NGF told Arise Television last week that NNPC’s claim that daily petrol consumption has risen to 93 million liters was a colossal lie.

Unfortunately, the NGF chairman tends to believe that NNPC’s lies could only be countered with a petrol pump price that would beat both the Nigerian Customs Service (NCS) collaboration with smugglers and the cooking up of figures by NNPC. NGF wants petrol pump price raised to N401 per liter.

That figure is about twice the open market pump price at the moment. With crude oil price at $68 per barrel, the open market pump price of petrol hovers around N235 per liter.

The veiled reason for the NGF recommendation is that NNPC blames the perceived surge in petrol consumption on smuggling of the product to Benin, Togo, Ghana, Niger and Chad republics.

The logic behind NGF’s recommended petrol pump price is that Nigeria’s petrol must be sufficiently expensive to reduce the profit margin that encourages smuggling.

A liter of petrol sells for N449.08 in Ghana. The average pump price of petrol in the four countries surrounding Nigeria is perilously close to N400 per liter. Consequently, if petrol subsidy is removed and the open market pump price climbs to N235 per liter, the N165 margin is considered enough incentive for smuggling to continue.

The worrisome truth is that both the NGF and the federal government know that NNPC is telling fat lies on Nigeria’s daily petrol consumption figures. Mele Kyari, NNPC’s group managing director is convinced that Nigeria cannot consume 93 million liters of petrol per day.  

In December 2017, a few months after the removal of petrol subsidy, NNPC announced that petrol consumption has dropped to 28 million liters per day. On February, 2018 when surging inflation forced the federal government to tacitly restore petrol subsidy, NNPC suddenly announced that daily consumption has risen to 60 million liters.

Everyone in the NGF and the federal government knows those smuggling Nigerian petrol to Benin, Togo, Ghana, Niger and Chad. The NGF wants to transfer its aggression from the powerful economic saboteurs in NCS and NNPC to defenseless Nigerian consumers of petrol.

No one wants to confront NNPC for defrauding Nigeria with absolutely indefensible petrol consumption figures. No one wants to confront the thieves in NCS for opening the gates at the borders for smugglers to ferry Nigeria’s imported petrol to neighbouring countries.

Reliable sources put Nigeria’s daily petrol consumption at 35 million liters per day. Since Nigeria’s daily consumption stands at 35 million liters, NNPC’s transparent lie suggests that 56 million liters of petrol is smuggled into the four tiny countries daily. That amount of petrol could flood those countries. They just do not have the facilities to store it.

Ghana consumes less than 10 million liters of petrol per day and its economy is larger than that of Benin, Togo and Niger put together. The daily consumption of the other three countries is less than 15 million liters. In all, the four countries targeted by NNPC consume just about 25 million liters of petrol daily.

Besides, they import most of the petrol they consume. What is smuggled from Nigeria is therefore an insignificant quantity. Niger itself has a refinery that makes it almost self-sufficient in refined petroleum products. NNPC’s lies falter in the face of the above mountain of evidence.

Sometime in 2018, Femi Falana, a senior advocate of Nigeria (SAN) demanded explanation for NNPC’s lies on daily petrol consumption. Leveraging on the Freedom of Information Act, Falana called on NNPC to furnish him with the documents confirming the importation of the quantity of petrol claimed by the corporation.

After weeks of dawdling, NNPC’S lawyer warned Falana in an irksome letter that the documents he demanded were trade secrets not covered by the Freedom of Information Act and that NNPC cannot release them. The simple truth is that NNPC’s dubious figures cannot be substantiated with import documents.

Ironically, no one in the federal government, the National Assembly or the NGF lifted a finger in protest against NNPC’S derisive way of covering up its lies.

There are fears that the federal government and the NGF know what NNPC does with the loots from petrol subsidy fraud. That explains the deafening silence from Aso Rock and the attempt by the NGF to transfer its aggression to Nigerian consumers.

By recommending petrol pump price of N401 per liter, the NGF is not worried about the effect of such hike in petrol price on headline inflation which currently stands menacingly at 18.1 per cent when Ghana with more than twice Nigeria’s petrol pump price, maintains inflation rate of 8.5 per cent. What the NGF wants could push headline inflation above 30 per cent within weeks of its implementation.

Nigerians have been taken for a ride for too long. Someone should tell the men in NNPC that their lies on daily petrol consumption are too transparent to be condoned. NNPC must stop stealing from the federation account with cooked up petrol consumption figures.

The NCS on its part must be compelled to shut the gates of Nigeria’s borders against the giant trucks that smuggle petrol daily into neighbouring countries. That is the only way to manage an inflation rate that is already pricing millions of Nigerians out of the food items market.  

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