Financial Energy Review
The Major Oil Marketers Association of Nigeria (MOMAN) said Nigeria needs to gradually reduce the subsidy of Premium Motor Spirit (PMS) while investing and subsidizing mass transportation and productive activities in such areas such as agriculture.
According to MOMAN If the country had spent monies spent on subsidies on education, health and infrastructure, Nigerians and Nigerian businesses would have been better equipped to face today’s energy challenges. Adding that the current regulated N165 pump price for Petrol is no longer realistic.
Mr Olumide Adeosun, Chairman, MOMAN, made this known on Wednesday during a virtual workshop for MOMAN and Energy Correspondents by the Federal Competition and Consumer Protection Commission(FCCPC).
Adeosun said that there is some energy nationalism going on globally leading to some major refining countries hoarding petroleum products like diesel for local use as was the case with COVID-19 vaccines.
“Some developing countries are subsidizing the cost, leading to widespread outages in those countries. Most countries are allowing the price to adjust, leading to higher prices but with product availability” he said.
He blamed the situation on the ongoing conflict between Russia and Ukraine which had disrupted global energy supply distribution.
He maintained that it would be difficult to enforce any kind of price control mechanism on marketers who had to slightly adjust their prices based on how much they bought products from the depots.
The MOMAN chairman said the way forward was a phased deregulation of PMS by the Federal Government to reduce the shock on consumers.
Adeosun said the gradual price deregulation should be followed with targeted palliatives in the areas of transportation and agricultural subsidies to the public to ease implementation.
He said the huge amount spent on petrol subsidy over the years would have been deployed to other critical areas that could have reduced the impact of the current energy crisis on Nigerians.
Adeosun empathised with Nigerians and the Federal Government who had been bearing the huge subsidy cost, adding that the government was working assiduously to mitigate the effects of the situation on the economy.
He said as the nation was moving towards full deregulation of the downstream petroleum sector, MOMAN would continue to collaborate with the FCCPC to ensure the protection of the rights of consumers.
Earlier, Mr Babatunde Irukera, Executive Vice Chairman, FCCPC, charged oil marketers to shun anti-competitive conducts and other acts that would short-changed consumers.
Irukera, represented by Mr Adamu Abdullahi, Executive Commissioner, Operations, FCCPC, reiterated the commission’s commitment to the protection of consumers from exploitation.
In his presentation, Mr Ikem Isiekwena, a lawyer and Partner at Simmons Coopers, urged MOMAN to promote efficient health, environmental, safety and quality related industry processes in accordance with the provisions of the FCCPC Act.
He also urged the marketers to liase and coordinate with specific industry regulators and its members on consumer protection issues.
Isiekwena tasked MOMAN with monitoring the conduct of its players to ensure compliance and act as an information hub for industry related consumer protection enquires.
