Chinomnso Awazie, (LinkMoment).
When crude was $100+ per barrel, there was definitely need for fuel subsidy to Nigerians as clearly, the crude oil being refined has to still come at prevalent market prices and imported fuel still hugged the crude price trajectory. Common sense makes it abundantly clear that the higher the price of raw materials, the higher the price of the finished product and vice versa.
When crude price was hovering at $100+ per barrel, actual landing price of Petroleum Motor Spirit (PMS) was about N130 – N140 naira per litre. Government had to subsidise it to N87 Naira per litre. In the United States, gas (PMS) prices hovered near $5 dollars per gallon at that time.
Today, the same crude oil is opening at a record low of US$35 per barrel. Elementary arithmetic makes it abundantly clear that this is about 30% of when the price touched US$110 dollars. Translating that to gas prices has made it such that today, gas prices in the US is about $2 dollars per gallon in many places.
That’s roughly over 60% decrease in the price of gas, a real raw material versus finished product price response.
In Nigeria, what this should have meant is that the average PMS landing cost of N135/L @$110/barrel crude price should have now become nothing more than N42 litre based on $35 per barrel crude prices.
But how can Buhari spite those that bankrolled the rigging that brought him to power? Tinubu, Otedola, Con oil, Atiku, etc., how he attack the oil marketing cabals? The subsidy was kept, and after the recent over N500 billion bazaar of subsidy payment that accumulated within just 4 months under Buhari, he now comes out to make the corruption in that part of the Oil Sector legal by announcing N85 per litre.
In case you are wondering why I said the N500 billion bazaar was accumulated within four months under Buhari, let me clarify you;
1. In April, at the twilight of Goodluck Ebele Jonathan (GEJ’s) administration, when Buhari claimed he doesn’t know what subsidy meant, oil marketers decided to collect what was owed them by all means possible before ‘the messiah’ that doesn’t know what subsidy means took over the government. Whereas Federal Government claimed they owed N156 billion, marketers marked it up to N256.2 Billion on account of increased cost of FOREX. At the World Customs Day held in Abuja on 29 April, then Finance Minister, Ngozi Okonjo Iweala declared the subsidy the money will be paid the next day. Let me quote her verbatim:
“We have been engaging oil marketers over the scarcity issue. We paid them N350 billion and N31 billion in the foreign exchange differential in December. “Tomorrow (which is 30th April, 2015), we will be paying them N100 billion for which we had earlier given them ‘I Owe Yous’ (IOUs), and interest rate differentials of N56 billion. I am about to sign to get that paid and I think Nigerians will agree that the government is making good effort to accommodate the oil marketers. They are also Nigerians and they also need to co-operate with us”, Ngozi Okonjo Iweala, said.
So, hope it’s clear to you now that GEJ cleared his ‘subsidy tables’ before he left office?
2. This current fuel scarcity has entered the seventh week, i.e approximately two months. Buhari has been in office for seven months. Minus 2 from seven, you would get 5 months. This scarcity started on the basis of
ACCUMULATED subsidy arrears. Cosseting that as at May, 2015, there was not subsidy arrears as GEJ wiped the slate clean and that marketers won’t start agitating the very month their monies are due, it is clear this N500 billion arrears accumulated in four months or even less.
Yet, Lai Mohammed (Buhari’s Information Minister) could muster the courage to lie to Nigerians that the subsidy accumulated under GEJ and people with human brains agreed! What portends a bigger danger to Nigeria are those that keep supporting these lies and evil.
For Nigerians that rejected Goodluck Jonathan, enjoy the Badluck Buhari that you chose! Of course, they will keep telling lies that does nothing else than call you all big fools!