…Marginal Increase In PMS Price To Boost Petrol Availability
In a bid to cushion the negative impact of high operating cost on the availability of Premium Motor Spirit across the country, the Federal Government has approved an upward review of N10 on the retail price of petrol.
The approval, according to findings by WEEKDAYS SMART NEWS was given by the Nigerian Midstream and Downstream Petroleum Regulatory Authority.
With the upward review, the price of Premium Motor Spirit will now be raised from the current range of between N175 and N180 per liter to about N185 and N190 per liter.
Further findings by WEEKDAYS SMART NEWS showed that the increase is to compensate for the current market realities associated with escalating foreign exchange and high lightering charges such as cost of chartering shuttle vessels for discharge of PMS.
These costs, according to a top official of government, have negatively impacted the movement of PMS to designated depots.
Current market realities, according to findings indicates that chartering of STS/Shuttle vessels has now moved from between $18,000 per day to around $65,000 per day thereby impacting on high operating cost
The source said, “There has been an upward review of the Premium Motor Spirit (PMS) Retail prices by about #10/Litre. This is to compensate for the current market realities associated with escalating foreign exchange and high lightering charges (cost of chartering shuttle vessels for discharge of PMS), which is impacting on movement of PMS to designated depots.
“Current market realities indicates that Chartering of STS/Shuttle vessels has now moved from between $18,000 per day to around $65,000 per day thereby impacting on high operating cost.”
Findings further revealed that the increment is in line with the Federal Government ‘s move to remove the subsidy payment on petrol.
The Federal Government had two weeks ago announced plans to stop the payment of fuel subsidy by the end of June this year.
The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, had while disclosing this during the public presentation of the 2023 Federal Government budget stated that in the 2023 fiscal period, the government has made provisions of N3.36trn for fuel subsidy payment to cover the first six months of this year.
This, she stated, is in line with the 18-month extension announced in early 2022.
She expressed concern that the fuel subsidy regime was hurting Nigeria’s ability to service its debts and meet up with capital expenditure.
The finance minister called on Nigerians to understand that fuel subsidy was causing a massive fiscal burden, saying a situation whereby the federal government borrows for consumption
She said, “The projected fiscal outcome in the 2023 Budget is based on the PMS subsidy reform scenario.
“In the 2023 Budget framework, it is assumed that petrol subsidy will remain up to mid-2023 based on the 18-month extension announced early 2022.
“In this regard, only N3.36trn has been provided for PMS subsidy. There will be tighter enforcement of the performance management framework for Government Owned Enterprises that will significantly increase operating surplus/dividend remittances in 2023.”
