The Group Managing Director of the Nigerian National Petroleum Corporation (NNPC), Mele Kyari, said that fuel could go for N256 per litre if the corporation sold the product at the current exchange.
Kyari said this at a stakeholders meeting convened by NNPC in Abuja, with the Minister of State for Petroleum Resources, Timipre Sylva, and the Chairman of the Economic and Financial Crimes Commission (EFCC), Abdulrasheed Bawa, present.
“If we are to sell at the market today at the current exchange rate, we will be selling the product at about N256 to a litre. What we sell today is N162, so the difference is at a cost to the nation,” Kyari said.
He noted that an increase in the volume of fuel consumption by Nigerians would lead to oil prices dancing between N162 and N256.
He said that “as long as we don’t regulate volume until we are able to exit this current level, which I know so much work is going on, then we have to manage the volume that we are exposed to between this price of N162 and N256”.
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“The difference comes back to as much as N140 billion to N150 billion cost to the country monthly. As long as the volume goes up, that money continues to increase and we have two sets of stress to face, the stress of supply and stress of foreign exchange for the NNPC. We may not see foreign exchange cheque taking place for importation.”
Sylva, on the other hand, said that prior to his taking up office, he had been informed of a consumption volume that was lower than expected considering the number of vehicles on the roads.
He said, “I would like to put it on record that whatever we are trying to do in the area of deregulation will not make sense without us exactly knowing the actual consumption of PMS.
“When I first came in as minister, I was informed that the daily consumption in the country was around 60 to 62 million litres a day, which to me sounded a little bit outrageous considering the number of cars we have on the road.
“But somehow, the figures, I understand today, have come down to around 52 million litres. Maybe the number of vehicles has suddenly reduced, but you will agree with me that something is wrong. That is why the tracking of trucks loading products is essential for us to move forward on this issue of subsidy removal.”
