Any increase in the price of Premium Motor Spirt as a result of the five per cent levy on the product as stipulated in the Petroleum Industry Governance Bill that was recently passed by the National Assembly will not be welcomed by Nigerians, oil marketers have said.
According to the Independent Petroleum Marketers Association of Nigeria, oil marketers may not kick against plans to increase the price of PMS, popularly called petrol, but such a move will face resistance from the masses.
IPMAN members form the largest number of filling station owners across the country, as the association claimed that over 70 per cent of PMS retail outlets in the downstream oil and gas sector were being run by its members.
At the plenary last Wednesday, the Senate passed the harmonised version of the PIGB, which seeks to unbundle the Nigerian National Petroleum Corporation and merge its subsidiaries such as the Department of Petroleum Resources and the Petroleum Products Pricing Regulatory Agency into one entity.
The proposed law seeks to establish the Petroleum Equalisation Fund “into which shall be paid all monies payable to the Equalisation Fund,” including a five per cent fuel levy “in respect of all fuel sold and distributed within the federation, which shall be charged subject to the approval of the minister (of petroleum resources).”
Reacting to the development, IPMAN’s National Vice-President, Abubakar Maigandi, told our correspondent that any little hike in petrol price at the moment would not be accepted by Nigerians.
He said, “Any increase in the cost of PMS will not work well with Nigerians. I don’t know where they plan to get the five per cent levy from; is it through the Federal Government or through the marketers? However, we marketers are not against any increase (in pump price) provided that our margins are there and clearly stated.
“But from the political point of view, such a move will not work well with the masses. You know that even right now, the Federal Government is subsidising PMS because of the masses, which is good. We marketers appreciate what the government is doing in this regard, but if it decides to increase fuel price, of course, we can’t go against it.”
On the billions of naira owed by the government to marketers for subsidy incurred in previous years, Maigandi stated that the debt was due to the cheap cost of petrol in Nigeria when compared to the price of the commodity in other African countries.
The Major Oil Marketers Association of Nigeria and Depot and Petroleum Products Marketers Association had recently threatened to lay off employees if the Federal Government failed to pay the over N650bn debt that it owed oil dealers.
Maigandi said, “As of now, all what I know is that the government is trying its best considering the way things are. I say this because right now, Nigeria is among countries with the lowest costs of PMS. In fact, in Africa, the cost of fuel in Nigeria is one of the cheapest if not the cheapest.
“So, the government is trying its best as far as the sale and distribution of PMS is concerned. Also, marketers are currently pleased with the government because the product is available and the constraints of loading and delivery have significantly reduced.”
When probed further to state if government was owing members of IPMAN, the association’s spokesperson replied, “Normally, there is no way the government can go on without owing us, because they have to pay us the Petroleum Equalisation Fund and this payment is meant to be on a daily basis.
“So, these funds are always with the government, but they are now paying compared to the situation in the past. Therefore, it is right to say that the government is trying its best, especially when you relate it with what obtained in the past. Things are gradually picking up in the sector these days.”