By Dipo Awojobi – The Federal Government of Nigeria on Monday revealed that it was currently subsidizing petrol at N12.62 per litre.
The subsidy figure was for petrol imported directly by the Nigerian National Petroleum Corporation (NNPC) and dispensed at its retail outlets, while the rate was N12.88 per litre for other oil marketers, the latest Petroleum Product Pricing Regulatory Agency (PPPRA) Template says.
It said that although provision was not made for subsidy in the 2016 budget, it would be defrayed from “recoveries’’ made by the country from oil transactions in the first quarter of 2016.
Between January and March 2016, the Federal Government said it was able to save about N10 billion as a result of selling the product above the Expected Open Market Price.
Without the subsidy and given the landing cost of the product, the product ought to be sold at N98.62 per litre at NNPC outlets and at N99.38 per litre by major and independent oil marketers.
According to the template, the expected open market price is the actual price of the product without subsidy and it was based on the current exchange rate of N197 to a dollar.
The template revealed that for NNPC retail outlets and independent and major oil marketers, landing cost of petrol imported into the country is N84.32 and N85.08 per litre, respectively.