Fuel subsidy: FG spent 12bn in five days

The Petroleum Products Pricing Regulatory Agency, PPPRA. In its pricing templates for PMS, also known as petrol, has put the average amount paid as subsidy in the five-day period at N32.53 per litre, while the Expected Open Market Price of petrol stood at an average of N177.53 per litre for the five-day period.

The report showed that the Federal Government, through the Nigerian National Petroleum Corporation, NNPC, spent N12.69 billion to subsidise Premium Motor Spirit, PMS, in five days, between Monday, December 16 and Friday, December 20, 2019.

The PPPRA stated that 390.11 million litres of petrol were supplied across the country during the period and based on the average amount paid as subsidy in the five day period, which stood at N32.53 per litre and the 390.11 million litres supplied across the country, the amount paid as subsidy by the NNPC on behalf of the federation stood at N12.69 billion.

The Expected Open Market Price, EOMP, of petrol is the price the commodity is expected to be sold to motorists if the government stops paying subsidy on the commodity.

The breakdown of the price of PMS in the days under review, the PPPRA’s templates showed that on December 16, 2019, EOMP of petrol stood at N177.33 per litre, leaving the government to pay N32.33 per litre as subsidy, while 76.86 million litres of PMS was supplied across the country. The price of PMS dropped to N177.32 per litre on December 17 while 82.97 million litres of PMS was supplied, hence, subsidy of N32.32 per litre.

In addition between December 18 and 19, 2019, EOMP of PMS stood at N174.81 per litre and N177.92 per litre respectively, while PMS 78.11 million litres and 72.46 million litres were supplied respectively. Hence N29.81 per litre and N32.92 per litre were incurred as subsidy on each of those days respectively.

To this end, N2.485 billion, N2.68 billion and N2.33 billion was incurred as subsidy by the NNPC on December 16, 17 and 18, 2019 respectively, while N2.33 billion and N2.81 billion was recorded as a subsidy, on December 19 and December 20 respectively.

As at Monday, December 23, the Expected Open Market Price of petrol rose to N180.78 per litre, with subsidy rising to N35.78 per litre, while the quantity of fuel supplied on December 23, 2019, was not available.