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Fuel Price May Hit N150 As Subsidy Receives Zero Allocation In 2015 Budget

Indications have emerged that fuel consumers in the country may be thrown into fresh hardship following the impending increase in the price of motor spirit.

Feelers from the 2015 Appropriation Act passed by the National Assembly last week indicated that no appropriation was made for fuel subsidy in the budget.

Going by the current landing cost including margins of N128.96 for refined petroleum product which is later subsidized by the Federal Government with N39.00, Nigerians may now be forced to pay between N150-N200 for a litre of fuel since the administration can no longer spend money not appropriated for.

Currently, a litre of petrol is sold for N87 a litre.For a Sport Utility Vehicle(SUV) with capacity for 70 litres at N6,090,which can last for one week, depending on the distance covered .This amounts to N24,360 in a month.

But under the new price regime, when subsidy is finally removed,a litre of petrol may go for as high as N150 and this amounts to N10,500 for a 70 litre capacity for an SUV,when multipled over four weeks,that amounts to N42,000,in a country where the minimum wage is N18,000.

The House of Representatives had on Thursday, April 23, approved N4.493 trillion as 2015 budget after raising the initial figure by N135.4 billion from the N4,357,960 trillion proposed by the executive in November 2014.

However, no provision was made in the approved 2015 Appropriation Act for fuel subsidy instead a lean N21 billion was provided for the Subsidy Reinvestment and Empowerment Programme (SURE-P).

Reacting to the development, the Executive Secretary of Major Oil Marketers Association of Nigeria (MOMAN), Obafemi Olawore, said allocation of zero resources for fuel subsidy in 2015 would pose a big challenge for Nigerians, as the price of fuel will soar uncontrollably.

 

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Comments (4)

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