Meanwhile, NNPC yesterday said the payment of fuel subsidy or under-recovery by the federal government was now a thing of the past, explaining that henceforth, market forces would determine the pump price of petrol.
The corporation also maintained that the country could not accurately ascertain the quantity of the product it consumes daily because while the agencies of government saddled with the job know how many trucks leave the depots everyday, it’s impossible to track where they are taken to.
NNPC Group Managing Director, Mr. Mele Kyari, who spoke in Abuja on a live television programme on AIT, also noted that no cash donation would be given towards the effort against COVID-19 by the petroleum industry, explaining that all contributions would be in kind after participating companies must have gone through their corporate procurement processes.
Kyari, who also dispelled insinuations that the country’s crude oil currently has no international buyer, added that given the quality of the resource Nigeria produces and the relatively short distance to its international buyers compared to its competitors, Nigeria has an advantage.
He said the current fall in the international prices of crude has given the country an opportunity to ‘liberalise’ the downstream oil industry, which implied that the price Nigerians would get from crude oil products would now be determined by market forces.
He added that with full liberalisation, the pump price of fuel would fall further in the next few weeks.
“As at today, there’s no subsidy, no under-recovery. It’s zero forever. What I mean is that going forward, there will be no resort to subsidy or under-recovery of any nature. NNPC will play in the market place . We will just be another marketer in the space. But we will be there to ensure security of supply,” he said.
NNPC boss, who also faulted the allegations that the organisation remains one with no commitment to transparency, noted that the corporation was not an opaque organisation, disclosing that every month it publishes its financial transactions or standing for public consumption.
According to him, “ With price liberalisation, this (actual consumption) will be sorted out and we will know our real consumption. So, now what we call consumption is how much of these products get into the fuel stations and is actually bought by cars and generators. But the market will take care of that.
“As soon as this situation (COVID-19 pandemic) abates and we are able to go into real market conditions, it will be a consideration of commerce and we will have no challenge.
“But I know we are transitioning to a full market situation and the forces of demand and supply will regulate the prices, while avoiding the possibility of abuses that can come out. Ultimately, the market forces will take shape in a way that everybody will benefit from it.
“In terms of expecting lower prices associated with crude oil price decline, the product price tallies behind the crude oil prices. If crude oil prices collapse today, the reality of those prices will come in two or three weeks. From production to delivery takes three to four weeks and therefore, it is only at that time that you see the impact of changes in price.
“But as we go forward, the impact will come because the product we see today were produced three to four weeks today. In that three weeks you will see further commensurate decline in prices of products. Not what we expect today.”