THUR, JULY 09 2020-theG&BJournal-Timipre Sylva, the Minister of State for Petroleum Thursday clarified the Federal Government’s recent petroleum products deregulation policy.
He said the policy means that the Federal Government will no longer continue to be the main supplier of Petroleum Products, but will encourage private sector to take over the role of supplier of the products.
‘’This means also that market forces will henceforth determine the prices at the pump,’’ Sylva said in a statement released on his Instagram handle.
He said ‘’In line with global best practices, Government will continue to play its traditional role of regulation, to ensure that this strategic commodity is not be priced arbitrarily by private sector suppliers, a regulatory function not unlike the role played by the Central Bank of Nigeria in the banking sector-ensuring that commercial banks do not charge arbitrary interest rates.’’
He explained that the FG indicated at the time, that increase in crude oil prices will also reflect at the pump.
‘’This is a necessary action taken by a responsible Government in the overall interest of Nigerians,’’ he said, adding that one of the reasons the government have been unable to attract the needed level of investments into the refining sector has been the burden of fuel subsidy.
‘’We need to free up that investment space so that what happened in the banking sector, aviation and other sectors can happen in the midstream and downstream oil sector. We can no longer avoid the inevitable and expect the impossible to continue.’’
According to Sylva, after a thorough examination of the economics of subsidising Premium Motor Spirit (PMS) for domestic consumption, the Federal Government concluded that it was unrealistic to continue with the burden of subsidising PMS to the tune of trillions of Naira every year. More so when this subsidy was benefitting in large part the rich rather than the poor and ordinary Nigerians.
‘’There was no time Government promised to reduce pump price and keep it permanently low,’’ he said.