The Minister of Information and National Orientation, Mohammed Idris, revealed on Wednesday that Nigeria has witnessed a significant decline in the importation of Premium Motor Spirit (PMS), commonly known as petrol, by 50% since the removal of subsidy on the commodity.
The withdrawal of the subsidy was announced by President Bola Tinubu during his inaugural speech on May 29, 2023. Subsequently, within 24 hours of the declaration, the Nigerian National Petroleum Company Limited (NNPCL), the country’s sole importer of PMS, halted subsidy on petrol.
This move triggered a surge in the price of petrol from around N198 per litre to over N500 per litre, later escalating to between N620 and N700 per litre, depending on the location of purchase.
Speaking at the third edition of the ministerial press briefing series in Abuja, Idris disclosed that the removal of the subsidy had led to a 50% reduction in fuel imports. He stated, “Petrol importation has been reduced by 50 per cent since the withdrawal of the fuel subsidy.”
Prior to the subsidy removal, the Group Chief Executive Officer of NNPCL, Mele Kyari, had highlighted that Nigeria was consuming approximately 66 million litres of PMS daily. He also revealed that over N400 billion was being spent monthly to subsidize PMS, adversely affecting NNPCL’s cash flow.
With the latest revelation by the information minister, indicating a 50% reduction in petrol imports, it implies a decrease of about 33 million litres daily, based on NNPCL’s February figures. This translates to a staggering reduction of about 990 million litres in one month.
Additionally, oil marketers have echoed sentiments of a drastic decrease in petrol consumption. Bennet Korie, the National President of the Natural Oil and Gas Suppliers Association of Nigeria, noted that filling stations were shutting down due to reduced business, with 70% of downstream oil sector businesses already closed.
Meanwhile, amidst reduced global funding for hydrocarbon ventures in Africa, the African Export-Import Bank disclosed investing $30 billion in industry projects, with Nigeria receiving the lion’s share of 60%, amounting to $18 billion.
President of Afreximbank, Prof. Benedict Oramah, emphasized the need for Africa to find innovative solutions to its energy deficit, underscoring the importance of access to adequate funding resources controlled by the continent.
