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Breaking News: NNPCL Increases PMS Price to ₦998 Per Liters In Lagos

OilandGasAdmin 0 Comments October 9, 2024

Olaitan Olutimehin Johnson October 9, 2024

The Nigerian National Petroleum Corporation (NNPC) has made a significant announcement regarding the increase in the price of Premium Motor Spirit (PMS), commonly known as petrol. Effective immediately, the price of PMS will rise to ₦998 per litre, marking one of the highest price hikes in Nigeria’s history. This latest development has sparked widespread concern, as the cost of fuel continues to surge following the removal of the oil subsidy by President Bola Ahmed Tinubu earlier this year.

A New Era of Fuel Pricing in Nigeria

The decision to increase PMS prices comes in the wake of ongoing economic challenges and global market dynamics. According to the NNPC, the rise in global crude oil prices, the devaluation of the naira, and the removal of fuel subsidies are the primary factors behind this drastic price surge. The change in price has sent shockwaves across various sectors of the economy, with Nigerians already expressing concerns about the impact this will have on the cost of living, transportation, and goods and services.

According to an insider of the NNPCL who chose not to be mentioned or quoted, said the reason behind the price increase may be linked to the rising crude oil prices in the international market, as revealed to our correspondent..

And also mentioned that the price adjustment is necessary to ensure adequate supply and to maintain profitability in the oil sector. However, the timing and scale of the increase have caught many Nigerians off guard, as the country continues to grapple with rising inflation and economic uncertainty.

The End of Oil Subsidies: A Turning Point

The current fuel price increase is part of a broader narrative that began with the removal of the oil subsidy in May 2023, just days after President Tinubu assumed office. The removal of the subsidy was one of Tinubu’s most controversial economic reforms, aimed at addressing Nigeria’s mounting fiscal challenges.

For decades, Nigeria had maintained an oil subsidy program that kept the price of petrol artificially low, allowing Nigerians to enjoy some of the lowest fuel prices globally. However, this subsidy came at a heavy cost to the government, which was spending billions of naira annually to keep fuel prices low. By removing the subsidy, Tinubu sought to redirect these funds toward infrastructure, healthcare, and education, while also reducing the fiscal deficit.

During his inauguration speech, Tinubu declared, “Subsidy is gone,” marking the beginning of a new chapter in Nigeria’s economic history. The removal of the subsidy was met with mixed reactions, with many acknowledging that while the subsidy was unsustainable, its removal would lead to higher fuel prices and increased hardship for ordinary Nigerians.

A History of Fuel Price Increases Since the Removal of Subsidy

Since the removal of the subsidy, Nigeria has witnessed a series of fuel price hikes, each with its own economic and social implications. The timeline of fuel price increases since Tinubu’s administration took this bold step paints a picture of the challenges faced by the government and the Nigerian people in navigating the post-subsidy landscape.

1. May 2023: Subsidy Removal and Initial Price Hike

On May 29, 2023, President Tinubu’s announcement of the removal of the oil subsidy immediately led to an increase in fuel prices. Within days, the price of PMS rose from ₦189 per litre to an average of ₦500 per litre. This initial hike was met with shock and protests across the country as Nigerians struggled to adjust to the new reality.

Despite government assurances that the removal of the subsidy would lead to long-term economic benefits, many Nigerians felt the pinch almost immediately, with transportation costs doubling and the prices of goods and services skyrocketing. Tinubu’s government promised palliative measures to ease the burden on the population, but the effectiveness of these measures has remained a point of contention.

2. June 2023: Further Adjustment to ₦617 Per Litre

Barely a month after the subsidy removal, the price of PMS rose again, this time to ₦617 per litre. The NNPC cited the fluctuating international crude oil prices and the depreciation of the naira as the reasons for the increase. At this point, the shock of the initial subsidy removal was still fresh, and many Nigerians were grappling with the rising cost of living.

The June 2023 price hike led to widespread criticism of the government’s decision to remove the subsidy without putting adequate measures in place to cushion the impact. Labor unions and civil society organizations organized protests and threatened strikes, demanding that the government reverse the decision or provide more substantial palliatives.

3. August 2023: A Gradual Climb to ₦720 Per Litre

In August 2023, the price of PMS rose yet again, this time to ₦720 per litre. The NNPC, in its defense, pointed to the global oil market and the ongoing depreciation of the naira against the dollar as contributing factors. The government reiterated its stance that the removal of the subsidy was necessary to stabilize Nigeria’s economy and reduce its reliance on debt.

The August increase was met with increasing public frustration, as transportation costs, food prices, and general living expenses continued to rise. Many Nigerians called for more government intervention, while labor unions renewed their calls for strikes and protests.

4. October 2023: Price Reaches ₦800 Per Litre

By October 2023, the price of PMS had climbed to ₦800 per litre, signaling the persistent pressure on Nigeria’s fuel pricing system. This price adjustment came amid rising global crude oil prices, which had surpassed $90 per barrel. The devaluation of the naira had also deepened, exacerbating the cost of importing refined fuel.

At this point, the impact on Nigerians’ daily lives was undeniable. The cost of transportation had soared, and many businesses, particularly in the informal sector, were struggling to survive. Despite the challenges, the government continued to defend its subsidy removal policy, arguing that it was necessary to attract investment into the downstream sector and encourage local refining.

5. December 2023: Price Reaches ₦880 Per Litre

As the year drew to a close, the price of PMS increased yet again, this time reaching ₦880 per litre in December 2023. The increase was driven by a combination of global oil market trends, currency depreciation, and the government’s decision to fully deregulate the oil sector. The NNPC stated that it was committed to maintaining fuel supply despite the challenges, but many Nigerians were beginning to lose hope that the situation would stabilize.

6. January 2024: New Year, New Price – ₦950 Per Litre

The beginning of 2024 brought little relief, as the price of PMS hit ₦950 per litre in January. This increase was one of the sharpest yet, and it further strained the finances of Nigerian households. The government announced plans for more social interventions, but skepticism remained high, especially as labor unions continued to demand that the government reverse the removal of the subsidy.

7. October 2024: The Latest Increase to ₦998 Per Litre

And now, in October 2024, the NNPC has announced the latest and most significant fuel price increase yet, pushing PMS to ₦998 per litre. This latest adjustment reflects ongoing global oil market trends, currency depreciation, and the full deregulation of Nigeria’s downstream oil sector.

The increase in fuel prices has led to widespread concern across Nigeria, as the effects of the rising costs are felt in nearly every aspect of daily life. Transportation costs, for example, have risen dramatically, making commuting difficult for many, particularly those who rely on public transport. Small businesses, which depend on petrol for generators due to unreliable electricity supply, have been hit hard, with many being forced to close or scale down operations.

The rise in fuel prices has also led to a surge in inflation, with food prices, household goods, and services becoming more expensive. This has exacerbated the challenges faced by Nigeria’s most vulnerable populations, who were already struggling with high unemployment rates, low wages, and economic insecurity.

Fuel/ News/ NNPC/ Oil and Gas

We Are Ready for Business: IPMAN President Speaks Out Strongly

OilandGasAdmin 0 Comments October 8, 2024

The National President of the Independent Petroleum Marketers Association of Nigeria (IPMAN) has assured Nigerians that once the association starts lifting premium motor spirit (PMS) from the Dangote Refinery, the public will benefit from favorable prices, as crude oil is sold to the refinery in naira. Despite this, the Petroleum Retail Outlets Owners Association of Nigeria (PETROAN) remains committed to continuing fuel imports, citing concerns over refinery output and business sustainability.

Maigandi reassured that there is no cause for concern, addressing reports that the Nigerian National Petroleum Company (NNPC) Limited has ended its exclusive purchase agreement with the Dangote Refinery. This development opens the market for other marketers to directly source petrol from the refinery, which has a capacity of 650,000 barrels per day. Maigandi’s comments suggest a more competitive environment that could benefit consumers and petroleum marketers alike.

Although neither NNPCL nor Dangote Refinery has confirmed or denied the reports, the move suggests that NNPC will no longer serve as the sole buyer, allowing other marketers to directly negotiate prices with Dangote Refinery. Maigandi, speaking for IPMAN, welcomed this development, stating that if NNPCL can purchase directly, so should they. He noted that concerns over pricing should not be an issue, pointing out that they currently buy petrol from NNPC at over ₦800 per litre, but expressed optimism about how things will unfold.

Maigandi expressed confidence that selling crude oil to Dangote Refinery in naira would result in favorable pricing for Nigerians. He reassured that IPMAN is fully prepared to commence business and urged citizens not to worry about fuel prices. According to him, once they begin lifting petrol directly from the refinery under the naira sales regime, consumers will be pleased with the outcome, promising that this move will bring relief to the public.

He explained that independent marketers had not previously purchased Dangote petrol from NNPCL because they were waiting to see the pricing structure. He added that while they are open to any terms, their preference is to source directly from Dangote Refinery, which is the most suitable option for them. Meanwhile, Dr. Muda Yusuf of the CPPE emphasized the need for more transparency from NNPCL, pointing out that current pricing suggests a partial subsidy and urged clarity on whether the government plans to fully deregulate PMS prices.

He pointed out that, as a private company with loans to repay, Dangote Refinery must operate at market prices. This means that if all marketers begin purchasing directly from Dangote, it would signal the complete removal of any fuel subsidies. He also noted that the recent policy of selling crude oil in naira to the refinery might enable Dangote to sell at a similar price to what NNPCL previously offered, potentially compensating for the prior subsidy and benefiting all parties involved.

From a social standpoint, completely deregulating petrol prices at this time would be unwise given the current challenges Nigerians are facing, according to Yusuf. He urged the NNPC to address the situation publicly, as continued silence could lead to confusion and speculation. Yusuf recommended that the government maintain the current marginal subsidy on petrol to protect the most vulnerable members of society and prevent further economic strain.

Breaking News/ Fuel/ News/ World

Oando on the Verge of Acquiring Trinidad’s National Refinery

OilandGasAdmin 0 Comments October 8, 2024

In a significant development for the global oil and gas industry, Nigerian oil giant Oando Plc has been shortlisted as one of three final contenders to acquire Trinidad and Tobago’s state-owned Petrotrin refinery. This announcement was made by Trinidad’s Finance Minister, Colm Imbert, during his presentation of the country’s national budget on September 30, 2024. Oando is competing alongside two other bidders: the CRO Consortium, composed of three Trinidadian companies, and U.S.-based INCA Energy.

The bidding process, which started in February 2024, was overseen by U.S.-based Scotia Capital, which invited “expressions of interest” from potential buyers. Out of ten initial proposals, Oando and the two other companies emerged as the final contenders. The Trinidadian government will now move forward with a formal Request for Proposals (RFP) to determine the winner, with the aim of restarting the refinery if deemed feasible.

The Petrotrin refinery, located in Pointe-a-Pierre, has been closed since 2018, primarily due to significant financial losses, which reached $2 billion per year before its shutdown. As of the last audit, the refinery’s accumulated losses totaled $15 billion, while the country carries $3 billion in public debt on behalf of the company. When operational, Petrotrin was a key supplier of oil products to the Caribbean region, and its closure has had a considerable impact on Trinidad and Tobago’s energy sector.

Minister Imbert outlined that proposals were assessed on five key criteria, including a clear restart plan and timeline, asset integrity assessments, utility requirements, sources of crude supply, and a viable financing plan. The government also emphasized the importance of securing an agreement with Paria, the state oil company, to protect national interests and ensure fuel security.

Oando Plc, fresh off its $783 million acquisition of Nigerian Agip Oil Company in August, is well-positioned for this next potential acquisition. The Agip deal significantly increased Oando’s stake in Nigerian joint venture assets, giving the company control over 40 oil and gas fields, 24 of which are producing. Securing the Petrotrin refinery would be a strategic move for Oando, as it continues to expand its presence in the global oil and gas market.

Trinidad and Tobago, much like Nigeria, is a crude oil producer that depends heavily on imported petroleum products. Reviving the Petrotrin refinery could not only reduce this dependence but also restore its historical role as a major energy supplier to the Caribbean.

This potential acquisition marks a pivotal moment for Oando and the future of energy production in the Caribbean. As the global oil landscape evolves, the final outcome of this bidding process will be closely watched by industry experts and stakeholders alike.

Featured/ Fuel/ News/ NNPC/ Oil and Gas

NNPCL’s Dual Challenges: Between Postponed Promises and Private Partnerships

OilandGasAdmin 0 Comments October 7, 2024

Olaitan Olutimehin Johnson 7th October,2024

The Nigerian National Petroleum Company Limited (NNPCL) finds itself grappling with a complex situation: on one hand, there is the unfinished business of reviving government-owned refineries, most notably the Port Harcourt Refinery, which has seen countless delays; on the other, NNPCL is becoming increasingly involved as an intermediary between the newly operational Dangote Refinery and independent marketers. This dual focus reveals an underlying tension within Nigeria’s oil sector—a tension that has broad implications for energy security, pricing stability, and economic resilience.

The Long-Awaited Revival of Government-Owned Refineries

One of the most pressing challenges NNPCL faces is the continuous postponement of getting the government-owned refineries—specifically, the Port Harcourt Refinery—back to operational status. These refineries, once the pride of Nigeria’s domestic fuel production, have for years failed to produce any significant output due to mismanagement, lack of maintenance, and underinvestment. The Port Harcourt Refinery’s rehabilitation, originally projected to be completed years ago, has become a symbol of unfulfilled promises. Despite repeated reassurances, each announced operational date has ended in another delay.

These continuous postponements have frustrated both industry players and the general public. The expectation was that the refurbishment of the government-owned refineries would reduce Nigeria’s dependence on imported refined products and help stabilize the supply of Premium Motor Spirit (PMS). Yet, every new missed deadline only emphasizes NNPCL’s struggle to bring this vision to life. The prolonged delays mean that Nigeria continues to depend heavily on imported petrol, draining valuable foreign exchange reserves and subjecting the domestic market to international price volatility.

NNPCL’s inability to meet its refinery deadlines has broader implications for Nigeria’s energy landscape. The delays perpetuate an expensive reliance on imports, making Nigeria vulnerable to fluctuations in global oil markets and depriving the country of the opportunity to establish true energy independence. This situation directly impacts fuel prices across the nation, often resulting in high costs at the pump that ripple through other sectors of the economy, driving up the cost of goods and transportation.

Stepping in as the Intermediary Between Dangote and Independent Marketers

While the government refineries remain stuck in limbo, NNPCL has increasingly stepped in to play a different role—acting as an intermediary between Dangote Refinery, Africa’s largest private refinery, and the nation’s independent petroleum marketers. This new role comes with its own set of opportunities and challenges, signaling a pivot in NNPCL’s strategy amidst the delayed progress on their own refineries.

With Dangote Refinery now operational and producing petrol, NNPCL initially positioned itself as the sole buyer of PMS from the refinery, ostensibly to ensure a stable and streamlined supply chain. However, recent reports suggest that NNPCL is reconsidering this exclusive role. Instead of acting as the single point of purchase and distributor, NNPCL may opt to share responsibility with independent marketers, creating a more open, albeit complex, market dynamic.

This move raises several questions. Is NNPCL stepping away from its primary mandate to prioritize the rehabilitation and operation of the nation’s own refineries? By focusing on acting as a middleman between Dangote Refinery and independent marketers, NNPCL may be indirectly admitting its inability to swiftly restore the government-owned refineries. This evolving role, while seemingly practical in light of current fuel demands, also indicates a strategic shift from being a production-centric entity to more of a logistics and supply-chain facilitator.

For independent marketers, having direct access to Dangote’s output could mean more competition and, ideally, better pricing. However, without NNPCL’s coordinating hand, the market could become prone to price wars and supply inconsistencies, ultimately harming the average consumer. This uncertainty puts additional pressure on NNPCL to manage relationships and market expectations carefully, even as it attempts to figure out its own production capacities.

Broader Implications for Nigeria’s Energy Sector

NNPCL’s current situation presents a paradox: it’s an organization with significant potential and ambition but is caught between two competing roles. On one hand, it aims to fulfill the national goal of restoring government refineries to operational status—a crucial step towards reducing reliance on fuel imports and gaining true energy independence. On the other hand, the company is leaning into its role as an intermediary, seemingly to cover gaps created by the ongoing failure to rehabilitate its refineries.

This dual focus dilutes NNPCL’s capacity to make meaningful progress on either front. The delays in refinery operations mean that Nigeria continues to lose out on potential value-added benefits from refining its crude oil domestically. Meanwhile, by inserting itself as a middleman between Dangote and independent marketers, NNPCL risks entrenching itself in a complex intermediary role instead of developing its own production facilities.

Moreover, these moves have critical implications for fuel pricing and availability across Nigeria. The reliance on a single private entity—Dangote Refinery—for refined products creates a potential monopoly scenario, where market dynamics are subject to the pricing strategies and production decisions of one company. If NNPCL is unable to fully rehabilitate its refineries, this concentration of power in a single private refinery could lead to unstable pricing and limited control for the government over critical energy supplies.

Conclusion: A Need for Focused Strategy and Decisive Action

NNPCL’s current dual role is emblematic of the broader challenges facing Nigeria’s oil and energy sectors. The continuous postponement of government-owned refineries, particularly the Port Harcourt facility, highlights a persistent inability to achieve energy independence despite immense national resources. At the same time, the evolving intermediary role between Dangote Refinery and independent marketers points to a stopgap solution rather than a long-term strategic approach.

To address these dual challenges effectively, NNPCL must prioritize and clarify its focus. The government refineries must either be brought online without further delays or realistic alternatives must be developed, including potential partnerships or divestitures that could make these refineries functional. On the other hand, if NNPCL decides to continue acting as a mediator in the petrol supply chain, it must ensure transparency, fair pricing, and a stable supply to benefit both marketers and consumers.

Ultimately, NNPCL’s ability to move beyond its current position of “two mouths”—speaking both about refinery rehabilitation and private partnerships—will determine its role in shaping Nigeria’s energy future. By adopting a focused, strategic, and action-oriented approach, NNPCL can finally fulfill its mandate of securing energy stability for Nigeria, thereby laying the foundation for long-term economic growth and national development.

News/ Oil and Gas

Gbenga Komolafe: The Visionary Leader of NUPRC

OilandGasAdmin 0 Comments October 6, 2024

Gbenga Komolafe, the current Chief Executive of the Nigerian Upstream Petroleum Regulatory Commission (NUPRC), is a seasoned professional with decades of experience in the oil and gas industry. Known for his strategic acumen and in-depth understanding of the regulatory landscape, Komolafe has dedicated his career to advancing Nigeria’s oil sector, particularly the upstream division. With a background in engineering and law, he possesses a unique blend of technical and regulatory expertise that has significantly shaped his approach to leadership in the industry.

Komolafe has been instrumental in driving reforms aimed at ensuring transparency, efficiency, and compliance in the oil and gas sector. His emphasis on collaboration and stakeholder engagement has fostered better relationships between the regulatory body and industry players, enhancing operational harmony and trust. He has also been a vocal advocate for environmental sustainability and local content development, aligning with Nigeria’s long-term energy goals and the push for sustainable exploration practices.

Under his leadership, the NUPRC has made significant strides in the implementation of the Petroleum Industry Act (PIA), focusing on the critical transformation of the Nigerian oil sector to maximize revenues, boost investor confidence, and ensure the fair distribution of resources. Komolafe’s commitment to operational excellence and regulatory enforcement has made him a respected figure not only within the industry but also among policymakers and international stakeholders.

Gbenga Komolafe’s approach to leadership is defined by his transparency, accountability, and commitment to national development. His vision for the future of Nigeria’s oil and gas industry centers on strengthening indigenous participation, enhancing revenue flow through efficient resource management, and ensuring that the sector remains competitive in the global market. His reputation as a diligent, strategic leader continues to inspire confidence and drive positive change within the NUPRC and beyond.

Breaking News/ News/ World

Aliko Dangote Joins Global Leaders at 80th Anniversary Bretton Woods Conference to Shape Future of IMF and World Bank

OilandGasAdmin 0 Comments October 5, 2024

Aliko Dangote, President/CEO of Dangote Industries Limited, joined 44 other prominent global thought leaders, statesmen, and intellectuals at the Bretton Woods Conference in New Hampshire, USA, on September 26-27, 2024. This high-level retreat, marking 80 years since the establishment of the IMF and World Bank, was led by IMF’s Kristalina Georgieva and World Bank’s Ajay Banga. The meeting aimed to reflect on the origins of the Bretton Woods institutions and discuss their future direction amidst evolving global economic challenges.

SOURCE: Dangote Group

Fuel/ News/ Oil and Gas

Naira-for-Crude Deal Stalls Despite October 1 Agreement Between NNPCL and Dangote

OilandGasAdmin 0 Comments October 4, 2024

Olaitan Olutimehin October 4 ,2024

Naira-for-Crude Deal Stalls Despite October 1 Agreement Between NNPCL and Dangote

Despite the much-anticipated October 1 agreement between the Nigerian National Petroleum Company Limited (NNPCL) and Dangote Refinery, the Naira-for-crude oil deal has failed to take off, raising fresh concerns over the stability of Nigeria’s energy supply and the ongoing currency challenges facing the country.

The agreement, which aimed to allow the exchange of locally refined petroleum products for Naira instead of foreign currency, was expected to ease the foreign exchange burden on NNPCL. This deal was also meant to create a more sustainable supply channel for fuel, ensuring that the newly launched Dangote Refinery would process crude from Nigerian sources while bolstering domestic supply. However, nearly a week after the official implementation date, no significant movement has occurred to operationalize the arrangement.

Officials familiar with the matter have cited procedural delays and lack of clear operational frameworks as key reasons for the stalled start. Industry insiders suggest that the practical execution of the deal has been hindered by logistical complexities, pricing uncertainties, and ongoing negotiations over payment mechanisms that align with the fluctuating value of the Naira.

The Dangote Refinery, which began operations with considerable optimism earlier this year, was expected to play a critical role in alleviating the fuel import costs that have drained Nigeria’s foreign reserves. However, sources within the energy sector point out that challenges such as currency instability, disagreement over pricing, and coordination between NNPCL and Dangote’s supply chain have hampered the project’s launch.

For Nigeria, where fuel imports continue to place heavy pressure on the economy, the failure of the Naira-for-crude deal to take off on schedule signals broader challenges in the government’s energy policy. The agreement was presented as a key component of ensuring more autonomy in the domestic fuel market while reducing Nigeria’s exposure to international price volatility and dollar demand.

While NNPCL and Dangote representatives remain optimistic, stating that talks are ongoing and progress is being made, there is concern among analysts about how long the delay will persist and what impact it will have on fuel pricing. Many are now questioning the feasibility of a Naira-based payment structure without robust currency stability measures in place.

The inability of the Naira-for-crude deal to launch on time highlights the growing need for comprehensive reforms in the oil sector, especially to address the persisting inefficiencies of fuel imports and foreign currency dependency. For the average Nigerian consumer, any further delays in stabilizing domestic fuel supply could mean continued high prices at the pump, and for the broader economy, another setback in the quest for foreign exchange relief.

Breaking News/ Fuel/ News

NNPCL Shuts Down Customer Express Portal: Impending Fuel Scarcity Looms Amid Disruptions

OilandGasAdmin 0 Comments October 3, 2024

Nigeria’s oil and gas industry faces a new wave of challenges as the Nigerian National Petroleum Company Limited (NNPCL) has unexpectedly shut down its Customer Express Portal, a key payment platform for oil marketers. The shutdown has sent shockwaves across the petroleum supply chain, with many experts warning that fuel scarcity is now an imminent risk in the coming weeks.

The Customer Express Portal is the main gateway used by marketers for payments into NNPCL’s account, enabling seamless financial transactions and facilitating the lifting of petroleum products. This platform has been integral to ensuring the smooth operation of the downstream petroleum sector, allowing for the timely settlement of obligations necessary to secure product allocation and distribution across the country.

Breaking News/ Fuel/ News/ Oil and Gas

Illegal Levies Resurface: Oil Marketers Face Extortion at Nigerian Depots

OilandGasAdmin 0 Comments October 3, 2024

oil marketers

In a troubling development for Nigeria’s petroleum sector, oil marketers across the country have raised alarms over illegal levies being imposed on them by union operatives at various oil depots. Despite previous efforts to abolish such practices, these illicit fees have found their way back, leading to increased costs that ultimately burden consumers.

The resurgence of these illegal levies has been confirmed by multiple sources within the oil marketing industry. Marketers report that unions at depots across the country are demanding a charge of about N1 per liter of petroleum products loaded. This levy, while seemingly small, contributes significantly to the overall cost, adding to the landing cost per liter and inflating fuel prices for end users. For an industry already grappling with fluctuating international crude prices and domestic operational challenges, these unauthorized fees only add to the financial pressures on oil marketers.

The practice of imposing these levies was banned in the past, with regulatory authorities taking steps to streamline operations and improve transparency across the sector. However, it appears that the unions, through renewed influence, have once again infiltrated the system, reestablishing a culture of extortion that many had hoped was permanently eradicated.

Marketers and industry stakeholders have expressed frustration with this development, calling on the government and regulatory bodies to take immediate action. According to reports, the illegal levies not only increase operational expenses but also contribute to inefficiencies and delays within the supply chain, affecting the availability and cost of fuel nationwide.

One marketer, who preferred to remain anonymous, explained, “It’s disheartening that after all the efforts to create a streamlined and corruption-free supply chain, we are back to this. Every additional cost, whether it’s N1 or N10 per liter, eventually affects the pump price that consumers pay. We urge authorities to act swiftly to address this challenge before it spirals out of control.”

These union activities have drawn widespread criticism, with experts emphasizing that such practices could hinder progress in the nation’s energy sector and deter investments in the downstream segment. By inflating costs through unofficial channels, the unions are effectively undermining efforts to stabilize fuel prices and improve the overall efficiency of fuel distribution across the country.

With oil marketers calling for urgent intervention, the spotlight is now on Nigeria’s regulatory bodies to step in and put an end to these illegal practices. Industry watchers hope for swift and decisive action, as continued extortion threatens to undo years of progress made towards ensuring a fair, transparent, and sustainable petroleum industry.

Breaking News/ Fuel

Nigeria Scraps VAT On Electric Vehicles, Diesel, CNG, To Reduce Living Costs

OilandGasAdmin 0 Comments October 3, 2024

FG Removes VAT On Key Products To Cut Energy Costs, Boost Clean Energy Transition, And Attract Global Investments With New Tax Reforms

The Nigerian government has unveiled a bold move to reduce the cost of living by removing Value Added Tax (VAT) on key energy products, including diesel, Compressed Natural Gas (CNG), Liquefied Natural Gas (LNG), and electric vehicles. The new VAT exemption, announced by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, on Wednesday, is set to drive down prices and accelerate the nation’s transition to cleaner energy sources.

The VAT Modification Order 2024 covers a range of vital energy products and infrastructure, including: Diesel Liquefied Petroleum Gas (LPG) Compressed Natural Gas (CNG) Electric Vehicles Liquefied Natural Gas (LNG) infrastructure Clean Cooking Equipment According to Edun, the VAT exemption aims to reduce living costs, bolster energy security, and speed up Nigeria’s shift to greener energy alternatives. The initiative aligns with the administration’s commitment to sustainability and economic growth.

Tax Incentives To Boost Oil And Gas Investments

In a further move to drive economic growth, the government has introduced new tax incentives for deep offshore oil and gas production. The initiative, part of the Oil & Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order 2024, is designed to make Nigeria’s deep offshore basin a leading hub for global oil and gas investments. Edun emphasized that these reforms are part of broader policy initiatives spearheaded by President Bola Ahmed Tinubu, aimed at enhancing Nigeria’s competitiveness in the global energy market.

The latest tax relief measures aim to position Nigeria as a key player in the global oil and gas sector, ensuring sustainable growth in the energy industry.

Source: REPORT AFRIQUE (RA)

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