Home Energy Farmers, businesses face threat from Petrol price increase as product rockets to...

Farmers, businesses face threat from Petrol price increase as product rockets to N168 per litter in the South


 By Audrey Lotechukwu

 THUR, SEPT 03 2020-theG&BJournal-Farmers, traders and businesses are keeping a close watch on petrol price increase imposed by the Federal Government, which tend to bring great pressure on the bottomline.

Significant and sudden price shift in petrol price also tend to be linked to increased levels of volatility on agricultural markets in the country as well as food inflation.

The Federal Government increased the pump price of petrol for the third time in three months from N151. 56 from N148 effective September 2, 2020, and petrol stations across the country promptly switched to prices ranging from N158 to N168 per litre depending on which part of the country.

The country’s opposition party, the Peoples Democratic Party (PDP) promptly lead the voices of opposition to the increase, describing the move as ‘’ callous, cruel and punishing,’’ and demanded an immediate reversal of the prices to avert what it called ‘’a national crisis.’’

It said the increase will result in upsurge in costs of goods and services and worsen the biting hardship being faced by Nigerians, who are already improvised and overburdened by imposed high cost of living in the last five years.

The ruling party defended the move claiming that the increase is an evidence to show that the administration of President Muhammadu Buhari is working while blaming the PDP for the current predicament of the country.

The petrol price hike comes shortly after electricity tariff was doubled from N30.23 per kwh to over N66 per kwh.

Already, the impact is reflecting with transporters summarily hiking prices by as much 50% in some parts of the country and 75% in most part of the South and South East Nigeria.

Between Benin City and Onitsha, petrol pump price now ranges between N160 to N168 per liter, theG&BJournal investigation reveals. In Asaba, the Delta State capital, petrol is retailed at N168 per litre. Our correspondents say the price is as high as N160 per litre in Kano and Kaduna and in parts of Adamawa State it is as high as N165 per litre.

Some traders and transporters said that the increase is already reverberating on their input cost while businesses say they expect it to place additional pressure on their operation since the utilization of petrol in other sectors will have direct impact on their operation.

The road transport sector, reeling already from the impact of the coronavirus pandemic lockdown, is the sector facing the biggest impact of the fuel price hike policy because of their dependence on the product.

Any impact on their operations will have direct impact on affordability of their services. It will trigger the raise of price in food price as a result of higher distribution cost imposed on the seller. That in turn could send more people into poverty as food prices skyrockets.

‘’No sector’s production cost will be spared by this hike and given that it is the third within a space of three months, you can bet more Nigerians will be neck deep in poverty by the end of year,’’ one analyst told theG&BJournal.

|twitter:@theGBJournal|email: info@govandbusinessjournal.com.ng|