Group Managing Director (GMD) of Nigerian National Petroleum Corporation (NNPC), Mele Kyari has given an update on the increment of the pump price of Premium Motor Spirit (PMS).
Gatekeepers News reports that Kyari on Tuesday said the Federal Government is still in talks with the Organised Labour other stakeholders on how to properly price the product.
“The engagement is aimed at making sure there is a reasonable level of pricing that we can do that will recover the cost,” he said.
The NNPC boss explained that President Muhammadu Buhari has directed the Corporation not to make petrol price out of reach of Nigerians, “especially at this moment”.
“What this means, however, is that we are taking out cash that could have been used for other things to pay under-recovery”, he said.
Kyari, however, noted that the Federal Government’s inability to find an appropriate price for petrol has forced the continuation of the subsidy scheme.
Gatekeepers News reports that while the landing price is about N256 per litre, petrol sells for N162 to N165 in most parts of Lagos, according to the NNPC boss.
“The reality is that we cannot afford it,” Kyari said.
“But also the second reality is if you don’t do something smart, you could end up throwing prices at Nigerians that are well above prices that they should pay for.”
Gatekeepers News gathered that a large number of the petroleum the NNPC pays for is being smuggled to neighbouring countries where they are sold at higher prices.
“Petroleum consumption in Nigeria is not up to 60 million litres per day, but we supply up to that,” Kyari said.
“We always plan with 60 million litres, because anytime we do below that, there is a crisis.”
He noted that there “are sharp practices which we are trying to control” and “an organised cross-border smuggling of petroleum, which is associated with the price of petroleum itself.”
Kyari added that: “If everything works well and consumption is limited to our country, we are dealing with about 42 million litres.”
