The National President of the Petroleum and Natural Gas Senior Staff Association of Nigeria, (PENGASSAN) Festus Osifo, has alleged that the President Bola Tinubu-led federal government was still paying subsidies on petroleum products months after the removal of the subvention.
Osifo, who also doubles as the president of the Trade Union Congress, TUC, made this disclosure while speaking on Channels TV’s Politics Today on Friday.
He argued that due to the cost of crude oil in the international market and the dollar-to-naira rate, the government still pays subsidies for the product.
Osifo said, “They [the government] are paying subsidies today. In reality, there is a subsidy today because, as of when the earlier price was determined, the price of crude in the international market was somewhere around $80 for a barrel.
“But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, then the price [of petroleum] also needs to move,” he added.
Osifo added that for the government to stop subsidizing petroleum, “the only reason the price will not move is when you are able to manage your exchange rate effectively and you are able to pump in supply and bring down the exchange rate.
“So, if the exchange rate comes down today, we will not be paying subsidies. But with the exchange rate value and the price of crude oil in the international market, we have introduced subsidy.”
