With the latest increase in the pump price of Premium Motor Spirit (PMS) otherwise known as petrol, Nigerians have, no doubt, begun to feel the pressure that comes with deregulation. On March 18, this year, the pump price of the product was reduced to N125 per litre from N145 per litre effective March 19. There was a further downward review of the price on May 31 when the Petroleum Products Pricing Regulatory Agency (PPPRA) announced a new pump price band of N121.50 to N123.50 per litre effective June 1. The reduction in price then followed a sharp drop in crude oil prices on the back of the spread of coronavirus, which saw the landing cost of petrol hitting a record low. Nigerians had welcomed the development with much enthusiasm but the party was short lived. The market forces soon began to dictate the opposite and the price has been on an upward swing since July, which necessitated the outrage that has been trailing the new price band of N165 to N170 that came into effect penultimate Friday.
Earlier this month, the electricity Distribution Companies (DisCos) had also commenced the implementation of the revised electricity tariff, which has resulted in some residential consumers paying as high as N53.87 per kilowatt of electricity instead of the initial N21.80. The tariff hike came following the Federal Government’s decision stop subsidising electricity and allow what it termed Service Reflective Tariff (SRT).
Although Nigerians have been decrying the burden these price hikes have placed on them, President Muhammadu Buhari recently enjoined Nigerians not to expect a reversal.
Speaking through Vice President Yemi Osinbajo at the two-day First Year Ministerial Performance Review Retreat at the State House Conference Centre, Abuja, the President said there would be dire consequences if the government continues with the business of fixing or subsidising the price of PMS.
His words: “There are several negative consequences if the government should even attempt to go back to the business of fixing or subsidising PMS prices. First of all, it would mean a return to the costly subsidy regime. Today, we have 60 per cent less revenues; we just cannot afford the cost.
“The second danger is the potential return of fuel queues, which has, thankfully, become a thing of the past under this administration. Nigerians no longer have to endure long queues just to buy petrol, often at highly inflated prices. Also, as I hinted earlier, there is no provision for fuel subsidy in the revised 2020 budget simply because we are not able to afford it, if reasonable provisions must be made for health, education and other social services.”