The Petroleum Products Pricing
Regulatory Agency on Monday released
a new template for Premium Motor
Spirit, popularly known as petrol, which
puts its open market price at N134.60
per litre.
With the new price, the Federal
Government now spends N47.60 per
litre on petrol subsidy, amounting to
N1.90 billion daily at current
consumption volume estimated at 40
million litres daily nationwide.
Petrol at filling stations is sold at the
government regulated price of N87/
litre.
PPPRA said on its website on Monday
that the new pricing template took
effect from June 19, 2015 and was
based on Platts Prices for that day.
A breakdown of the template per litre
showed that the off-shore price is
N107.13, traders margin N1.47,
lightering expenses N4.47, NPA N0.77,
financing N1.75, jetty depot through
put charge N0.80, and storage charge,
N3.00.
This brings the landing cost to N119.11
per litre.
The distribution margin, according to
the agency, is made up of retailers
N4.60, transporters N2.99, dealers
N1.75, bridging fund N5.85, Marine
Transport Average N0.15, and
administrative charge N0.15.
With this, the distribution margin came
to N15.49 and open market price of
N134.49 per litre.
PPPRA placed the ex-depot price (for
collection) at N77.66.
With only N143 billion provided for
petrol subsidy in the 2015 budget, the
fund would last for just 75 days based
on the new template.
Audit of the subsidy regime from 2006
to 2012 by the Nigeria Extractive
Industries Transparency Initiative
(NEITI) revealed that about N4.5 trillion
has been spent on the subsidy of PMS.
Added to the figures for 2013 and
2014, the amount is expected to top
N6 trillion.
From December last year alone, about
N500 billion has been paid to the oil
marketers as subsidy.
The National Association Energy
Economists had last weekend
advocated the removal of the subsidy
because it benefits the rich more,
rather than the income redistribution it
was intended to achieve.
The group argued that though there
was nothing wrong with government’s
intervention in economic system, such
intervention must be significantly more
beneficial to the society than the
economic losses it brings.
The immediate past President of the
group, Adeola Adenikinju, explained to
newsmen in Abuja that cost of subsidy
has crippled government operations.
Adenikinju noted that the subsidy issue
would be one that the new government
needs to make immediate decision on.
Meanwhile the Abuja Zonal of the
Department of Petroleum Resources
has raised the alarm over persons
impersonating its officials at petrol
stations.
DPR cautioned filling station owners
and other marketers against falling
victims of phantom DPR officials.
DPR spokesman in Abuja, Mohammed
Saidu, said some fraudulent persons
have cashed in on the fuel scarcity
situation to defraud some unsuspecting
marketers, thereby causing overpricing
of fuel in some areas.
“The outcome of this scarcity has cost
us a lot where people now parade
themselves and go to filing stations
extorting money from marketers in the
name of DPR,” Saidu stated.
He said the fraudsters were going
around filling stations telling marketers
that they could sell at any amount they
wanted as long as they ‘settle
them’ (fake officials).
“That is why we are still having this
problem of over pricing in some of the
suburb areas within Federal Capital
Territory,” he said.
The spokesperson called on marketers
to be wary of fraudsters that claimed
to be DPR officials who go to filling
stations to extort money from them,
stressing that no official of the
department goes on inspection alone
and in private vehicle.
“We want to warn Nigerians that
before they deal with DPR, make sure
you are dealing with right official by
identifying himself,” Saidu said.
(The Eagle Online)
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