#THOTS: ⁠⁠⁠THE FEDERAL GOVERNMENT DID NOT REMOVE SUBSIDY

⁠⁠⁠THE FEDERAL GOVERNMENT DID NOT REMOVE SUBSIDY BECAUSE THERE IS NO SUBSIDY AT #86.5 PUMP PRICE OF FUEL

Before you go to protest against the removal of
fuel subsidy by the Federal Government, be
informed that the government did not remove
any subsidy because there was no subsidy to be
removed in the first place. So don't go and
protest against what does not exist. Seek
information and be informed. This is what the
government has done. The government has
simply stopped giving foreign exchange to fuel
importers and has asked them to source for
foreign exchange through secondary sources.
Why has the pump price of fuel increased from
#86.5 to between #135 and #145? This is
specifically as a result of the difrence between
the official exchange rate and the informal
(parallel) market exchange rate. This is the
simple mathematics. The official exchange rate
is #199 per dollar while the parallel market
exchange rate is #320 per dollar. This
represents and increase of 37% (320-199/320 ×
100 = 37.8%). This reflected exactly in the new
price of petrol as it increased from #86.5 to an
averag of #140 which is an increase of 38%
(140 - 86.5/140 ×100 = 38%). There may be a
gap in the dissemination of information to the
public and it is totally regrettable and I am sure
it will be taken care of, but I encourage
Nigerians to seek the right information. I have
always insisted that there was nothing like fuel
subsidy and I stand by that. The Federal
government cannot continue to be the sole
source of foreign exchange for the importation
of fuel in the face of falling price of crude
resulting in the depletion of our foreign
reserves. It is unsustainable and cannot satisfy
the domestic consumption of fuel in Nigeria.
Nigeria gets foreign currency from the sell of
crude and the price of crude has fallen by over
70%. This means that the government do not
long have enough dollars to give to fuel
importers. A lame man should be able to
understand this. With the competition that will
set in from the open market, it s expected that
the pump price of fuel will naturally crash in
time.

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