Nigeria’s fuel subsidy reaches N2.4bn per day

The federal government’s fuel subsidy reached N2.4bn a day in May, up from N774m in March 2018.

In March, when the price of crude oil was about $66 a barrel, it had fluctuated between $75 and $80 a barrel since last month, pushing up the price of refined product in the domestic market for importers of finished products like Nigeria.

According to a report released recently by the Petroleum Products Pricing Regulatory Agency (PPPRA), without the government subsidy, the price of petrol could have been as high as N205 per litre in the domestic market.

PPPRA stated, “the price of the commodity appreciated by 8.47 percent from N189 per litre recorded on April 25, 2018 to N205 per litre as at May 16, 2018.”

The PPPRA report revealed that during the reference week, between May 11 and May 16, 2018, oil prices continued to rise, indicating that the average price for Brent Dated was $ 77.92 per barrel; Nigeria’s Bonny Light was $78.08 while West Texas Intermediate, WTI, was $60.27 per barrel.

The Price of petrol is still fixed at a maximum of N145 per litre, meaning that the NNPC is currently paying N60 as under-recovery for a litre of the commodity.