The National President of the Petroleum and Natural Gas
Senior Staff Association of Nigeria (PENGASSAN) Festus Osifo, has claimed that
the Federal Government is still paying subsidy on petroleum products.
Osifo, who is also the president of the Trade Union
Congress, TUC stated this while speaking on Channels Television’s Politics
Today on Friday.
He said due to the cost of crude oil in the international
market and the dollar to naira rate, the government still pays subsidy for the
product.
Osifo said, “They [government] are paying subsidy today. In
reality today, there is subsidy 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
needed to move,” he added.
Osifo noted that for the government to stop subsidising
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 subsidy. But with the exchange rate value and the price of crude oil in
the international market, we have introduced subsidy.”
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