The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) has attributed the continuous hike in petrol prices to the floating of the naira, rather than the removal of fuel subsidies.
PENGASSAN President, Festus Osifo, explained that the primary challenge affecting the nation is the Federal Government’s devaluation of the naira.
Osifo emphasized the need for strategic management of the country’s exchange rate, stating: “The real issue is the naira’s devaluation, which has had widespread implications across several sectors, including fuel prices.”
He noted that if the naira were pegged at N450 per U.S. dollar, the price of petrol could have been significantly lower even with the subsidy removed. “In May last year, the official exchange rate was N450.
If Total Energies made a profit of $200 million, it would be multiplied by N450 to get the naira equivalent. Today, that same $200 million would be multiplied by N1,600, showing how much more naira the government is collecting,” Osifo explained.
The PENGASSAN President pointed out that agencies like the Federal Inland Revenue Service (FIRS) and the Nigeria Customs Service are declaring higher revenues as a result of the devaluation. “It’s not from subsidy removal; it’s the impact of the naira’s devaluation and exchange rate fluctuations,” he said.
Osifo argued that if the exchange rate for oil sector distributors were stabilized at N700 per dollar, the sharp rise in petrol prices would have been avoided.
