According to downstream oil and gas operators, the federal government has made N400 billion from the withdrawal of fuel subsidies in the previous 30 days.
Chinedu Okonkwo, National President of the Independent Petroleum Marketers Association of Nigeria, revealed this to the Daily Post on Friday.
In February, Mele Kyari, Group Chief Executive Officer of Nigerian National Petroleum Corporation Limited, NNPCL, claimed in a meeting with oil and gas operators that the country spends N400 billion each month on fuel subsidies.
Okonkwo stated that the deregulation has a long-term influence on the sector due to the removal of the subsidy and changes in the country’s foreign exchange market.
According to him, the development would result in either an increase or a decrease in fuel prices, depending on the market-determined price of FX.
He went on to say that adding compressed natural gas, or CNG, to the sector will progressively reduce the burden on the masses.
“You know how much the government spends each month on fuel subsidies, but that expenditure will be saved in dollars or Naira.”
“The government has indeed reduced spending on fuel subsidies, though the thing is biting, so we have drafted an alternative in Compressed Natural Gas, or CNG,” he explained.