Nigerian economic body and state oil firm discuss gasoline price change

An economic body that advises Nigeria’s government is in discussion with the state oil company to determine whether gasoline is appropriately priced in the country, a state governor said on Thursday.

The price of gasoline is a highly charged subject in Nigeria, Africa’s largest oil exporter. President Muhammadu Buhari in 2016 raised the top gasoline price to 145 naira ($0.4603) per litre, a 67 percent hike, but did not remove a cap for fear of hurting people with a low income.

The price cap makes it tough for many importers to profit from gasoline and NNPC has imported as much as 90 percent of the nation’s gasoline needs over the past year. Fuel shortages have gripped much of the country in the last few months.

A committee of the National Economic Council (NEC), which advises the government, has been in talks with officials at the Nigerian National Petroleum Corporation (NNPC) “with a view to determining the correct price for PMS [petrol]”, said Mohammed Abubakar, governor of the northern state of Bauchi.

He said the NEC committee and NNPC would look at gasoline prices while considering the price of fuel in neighbouring countries because price differences encourage smuggling out of Nigeria.

The relatively cheaper cost of Nigerian fuel combined with crude oil price rises in the last few months mean smugglers can make more money selling fuel intended for the Nigerian market across borders, creating shortages in the West African giant.

Nigeria’s refining system means it is almost wholly reliant on imports for the 40 million litres per day of gasoline it consumes.

Efforts by Buhari’s predecessor, Goodluck Jonathan, to end expensive subsidies in 2012 led to riots in the streets because the move would have doubled gasoline prices, angering citizens who see cheap pump prices as the only benefit from living in an oil-rich country.

Reporting by Felix Onuah; Writing by Alexis Akwagyiram, editing by David Evans

Related Content

A gas pipeline in Nigeria’s Delta state has been shut down, here’s why

A gas pipeline in Nigeria’s Delta state was shut down on Friday, according to state oil company NNPC and local authorities.

Unpacking NNPC’s new agenda as Kyari steps in

As the new Group Managing Director of the Nigerian National Petroleum Corporation (NNPC) assumes office today, Ayodele Oni, Chair and Partner of Energy & Natural Resources at Bloomfield Law Practice joins CNBC Africa for more.

Nigeria’s refinery overhaul projects to start in second quarter: NNPC

Refinery overhaul projects will begin in Nigeria as soon as the second quarter, an official from state oil company NNPC said on Tuesday. NNPC is...

NNPC plans to cut crude production cost to $20/barrel

NNPC plans to cut crude production cost to $20/barrel

Subscribe to our newsletter

Sign up for free newsletters and get more CNBC AFRICA delivered to your inbox

More from CNBC Africa

Uganda Securities Exchange CEO on how COVID-19 is impacting the bourse

The economic turmoil caused by the COVID-19 pandemic has had wide severe impact on financial markets not leaving behind stocks, bond and commodity markets. Uganda Securities Exchange CEO, Paul Bwiso joins CNBC Africa for more.

COVID-19: How the pandemic is accelerating the digitalization of healthcare

The COVID-19 pandemic has caused huge disruptions in healthcare provision, highlighting the need to adopt and invest in digitalization. Dr. Wanjeri Millicent Loice, Director and Content Manager, Toto Health Kenya joins CNBC Africa for more.

AfDB’s Nnenna Nwabufo on how COVID-19 has impacted African economies

According to the African Development Bank’s revised African Economic Outlook, though the continent is expected to rebound next year; it could lose a quarter of a trillion dollars in economic output for the rest of this year and 2021. Nnenna Nwabufo, Acting Director-General of East Africa Regional Office at the AfDB joins CNBC Africa for more.

Kenyan sports minister Amina Mohamed to bid for top WTO job

The Geneva-based body is seeking a replacement for Brazil’s Roberto Azevedo who is stepping down a year early at the end of August at a critical juncture for the trade watchdog.

Partner Content

Maktech’s Godwin Makyao: Now Is A Time of Entrepreneurial Opportunity in East Africa

As an executive decision-maker in both the telecommunications and tourism industries, Godwin Makyao could not have experienced a more diverse set of...

Sanlam launches urgent job-preservation initiative in response to COVID-19

Sanlam Investments is responding to the COVID-19 pandemic through large-scale support of the recovery of South African companies, from small enterprises to...

Trending Now

Steinhoff agrees to sell stake in Conforama France to Mobilux

JOHANNESBURG (Reuters) - Scandal-hit Steinhoff International agreed to sell its shares in furniture retailer Conforama France to Mobilux Sàrl, the parent company...

Namibia to ground national carrier’s license over cash hole

WINDHOEK (Reuters) - Cash-strapped Air Namibia will have its planes grounded at midnight on Wednesday after it failed to secure enough funding...

Uganda growth to sink as low as 0.4% this year – World Bank

KAMPALA (Reuters) - Ugandan economic growth is set to plunge to as low as 0.4% in 2020 from 5.6% last year as...

How retirement funds can contribute to rebuilding SA’s economy

Sanlam Benchmark Symposium: Sanlam has conducted research across a wide breadth of employers, retirement funds and professional consultants to benchmark their employee benefits experiences of the lock-down as well as their expectations of the future in a COVID-19 impacted economy. Chris Bishop spoke to Viresh Maharaj, Managing Executive, Sanlam Corporate Distribution, about the outcomes of the research and current trends in the Industry....
- Advertisement -