Emmanuel Addeh writes on the chaos that greeted last Friday’s purported increase in the pump price of petrol, noting, however, that it is akin to postponing the proverbial evil day
Beleaguered Nigerians who were looking forward to a relatively good weekend, woke up to the rude shock on Friday morning of the news of another rise in the price of petrol, a product that is literally the lifeblood of the country.
Although not unexpected, since the nation has been subtly put on notice by the authorities for a while, the jump from N162 to N212, an addition of over N50, riled many Nigerians who took to social to denounce the action.
Many filling stations across the country took advantage of the confusion that ensued , following the “announcement”, and immediately changed the pump price, from the initial price, with some of them selling for as much as N225. The scenes captured by angry Nigerians were at best tumultuous.
Characterised by long queues, traffic jams, immediate increase in the cost of transportation and the sudden shutdown of many petrol stations, it was déjà vu for Nigerians who have had to endure the pains of such decisions in the past.
The origin of the disconcerting news was traced to the Petroleum Products Pricing Regulatory Agency (PPPRA) which at midnight posted the pricing template of the product for March on its website.
Since the federal government announced its “deregulation” policy on March 19 last year, the agency had said it would thenceforth stop the monthly releases, since market forces would be allowed to determine prices.
Surprisingly, although the PPPRA neither communicated the template to the marketers nor categorically indicate that that would be the selling band for the month, the fact that it suddenly started making public the template was taken by the public as a collective government decision.
Although, the government’s information management system, again failed to live up to expectation, however, following the disruption in the daily activities of Nigerians, the dust eventually drew the attention of officials who attempted to douse the tension.
Hours after the chaotic public response to the alleged increase, the federal government pushed back on the insinuations that it had increased the pump price of petrol from N162 to N212.61 per litre, saying that it had not given any such approval.
Describing the information as “misleading”, the government maintained that it was unthinkable to raise the price of the product when negotiations were going on with organised labour and urged the general public to disregard any such reports.
While apologising to Nigerians for the inconvenience the stampede caused by panic-buying embarked upon by motorists, it maintained that it would not intentionally deceive Nigerians
In a statement personally signed by the Minister of State, Petroleum Resources, Mr. Timipre Sylva, in Abuja, the government added that there was no way a fuel pump price increase could have been effected without the knowledge of either President Muhammadu Buhari or the minister.
“Irrespective of the source of that information, I want to assure you that it is completely untrue. Neither Mr. President, who is the minister of petroleum resources, nor my humble self who deputises for him as minister of state, has approved that the pump price of petrol should be increased by one naira. I would therefore urge you to disregard this misleading information,” Sylva stated.
According to him, for the past few months the government has been in consultation with organised labour to find the least painful option to respond to the global rise in the price of crude, which in turn has inevitably led to increase in the price of petrol.
The minister maintained that it was unthinkable that government would unilaterally abandon the ongoing discussions and act in the manner suggested by the information under reference.
He added: “Cynicism and deceit have never been the trademark of the administration of President Muhammadu Buhari.
“I would like to equally assure you that the engagement with organised labour and other stakeholders will continue even as the calculations to arrive at a reasonable price regime are being done; all in good faith, and you will be availed of the final outcome at the appropriate time.”
The federal government warned marketers against taking advantage of the current confusion to inflict hardship on Nigerians, stressing that it would visit sanctions on any such attempts.
“Until then, all marketers are strongly advised to maintain the current pump price of PMS before the emergence of this unfortunate information. Those who may want to take advantage of this unfortunate misinformation to extort Nigerians should not give in to such temptation as there are regulatory mechanisms that government can enforce to protect its citizens.
“In conclusion, I want to sincerely apologise to all Nigerians for any distress and inconvenience the unfortunate information might have caused,” Sylva noted.
In the same vein, the Nigerian National Petroleum Corporation (NNPC) said it was sticking with its statement earlier in the month that there would be no fuel price increase in March, insisting on its official Twitter handle that “There shall be no increase in ex-depot price of PMS in March.”
Also, in an attempt to douse public tension caused by the information it released on its website midnight yesterday, the PPPRA, in a statement signed by its Executive Director, Abdulkadir Saidu, said that the document did not indicate that petrol price had been increased.
The PPPRA said that the “guiding prices” posted on its website was only indicative of current market trends and did not translate to any increase in pump price of petrol. It reminded the general public of the introduction of the market-based pricing regime for petrol regulation 2020 as gazetted by the federal government, declaring that based on the regulation, prices are expected to be determined by market realities in line with the dictates of market forces.
Saidu argued that one of the conditions for the implementation of the market-based pricing regime is the monthly release of the guiding price to reflect current market fundamentals.
He said that it was in line with the PPPRA’s mandate to maintain constant surveillance over all key indices relevant to pricing policy, monitors market trends on a daily basis to determine guiding prices that the data was made public.
“The agency is not unaware of the challenges with the supply of PMS due to some concerns leading NNPC to be the sole importer of PMS. PPPRA is also mindful of the current discussion going on between the government and the organised labour on the deregulation policy.
“ While consultation with relevant stakeholders is ongoing, PPPRA does not fix or announce prices and therefore there is no price increase. The current PMS price is being maintained while consultations are being concluded.
“Even though market fundamentals for PMS in the past few months indicated upward price trends, the pump price has remained the same and we are currently monitoring the situation across retail outlets nationwide,” the agency stated.
Sequel to the statement, it has also pulled down the template for petrol pricing from its website after the uproar and confusion caused by the development.
An analysis of the information further showed that the price of petrol may hit N212.61 per litre any time from now, if the authorities approved the latest price guide set by the agency.
Although the agency said last year that it would no longer be involved in fixing the price of the product since the market had been “deregulated”, it however released a lower band of N209.61 and higher band N212.61 per litre for the month in the latest template.
The pricing template showed the average price per ton of the commodity was about $561.96, or N169.22 per litre, while the average freight rate coat (North-West Europe to West Africa) was about $21.63 per or N6.51 per litre.
Also, the agency in the figures released earlier, said the ex-coastal price was N175.73 per litre, average lightering expenses was fixed at N4.81 per litre while the Nigerian Ports Authority (NPA) charge was put at N2.49 per litre;
In addition, the template revealed that the NIMASA charge is now N0.23 per litre; jetty throughput N1.61 per litre while storage charge is N2.58 per litre and average finance cost of N2.17 per litre, giving an Expected Landing Cost (ELC) of N189.61.
Further analysis put the wholesale margin at N4.03 per litre; administration charge at N1.23 per litre; transporters’ allowance (NTA) was fixed at N3.89 per litre; bridging fund cost was N7.51 per litre and Marine Transport Average (MTA) remained at N0.15 per litre.
With this, the expected ex-depot price for wholesale products marketers would be N206.42 per litre.
Earlier in the month, the NNPC assured Nigerians that there will be no price increase for the product in March until all negotiations with labour were concluded.
In its reaction, the Peoples Democratic Party (PDP), Nigeria’s main opposition party, advised the federal government against increasing pump price of petrol.
The party in a statement by its National Publicity Secretary, Mr. Kola Ologbondiyan, in Abuja said any contemplation to increase pump price of petrol to N212 would worsen the economic and social situations of Nigerians.
Ologbondiyan said that the N212 per litre reportedly contemplated in the March pricing template was not in the best interest of Nigerians, saying that it is a barefaced fact that there is no way that Nigerians can survive such a hike in fuel price, which will worsen the already agonising economic situation in the country.
“Our party maintains that with an honest and transparent administration of our national production capacity and potentialities, domestic price of fuel should not exceed N70 per litre,” the PDP argued.
Ologbondiyan said any increase in fuel price would be unacceptable with over 100 million citizens living in abject poverty, 23 per cent unemployment rate and many more living below N500 a day and called on the government to save the nation by ending every contemplation of fuel price increase.
For his part, the minister of Labour and Employment, Senator Chris Ngige said discussions were still ongoing between government and the organised labour as well as other stakeholders on the matter.
“I have made contact with the relevant authorities, the federal ministry of petroleum resources and the NNPC and wish to assure members of the public, especially the organised labour and workers that there is no such increase for now.
“We have ongoing discussions and standing committees comprising labour and government on one hand and another, comprising the office of the Vice President, Secretary to the Government of the Federation , Governor of the Central Bank of Nigeria (CBN), Group Managing Director of (NNPC) and the Ministers of Labour, Petroleum and Finance,” he said.
Ngige explained that the discussions were ongoing concurrently and that the next meeting between the federal government and the organised labour will hold immediately after the Easter break.
He said the present attempt to foist a fait accompli on the government and all its efforts runs against the ongoing discussions.
“We hence wish to warn the insidious harbingers of such information not to portray government as cruel, irresponsible and unamenable to social dialogue and collective bargaining.
“Government will at the right time do appropriate pricing for petroleum products but not without taking other issues into consideration. This is to ensure that Nigerians don’t suffer the pangs of any price increase in petroleum products.
“Government has deregulated petroleum products and market forces have to dictate pricing. That notwithstanding, the government has decided to give it a human face by agreeing to some palliative measures that will make the price realistic and affordable to the ordinary Nigerians.
“We, therefore, wish to reassure our partners in the organised labour, the NLC, TUC and affiliate unions that there will be no increase in the price of petrol for now. They should therefore continue to cooperate with government side to have a fruitful outcome from the discussions.”
For now, the brouhaha raised by the event of Friday morning may be subsiding, but given the market situation, mostly distorted, it’s a matter of weeks before long-suffering Nigerians return to the painful reality of paying more for fuel if the federal government, which is temporarily shouldering the responsibility of paying subsidy, decides to pull the rug from under their feet.
