FG reports monthly fuel imports cost N2tn
President Bola Tinubu has revealed that Nigeria spends N2 trillion each month on importing petrol and diesel.
In a recent nationwide address, Tinubu explained that despite Nigeria’s vast oil and gas resources, his administration inherited a situation where the country relied exclusively on oil and neglected its gas resources while subsidizing fuel costs.
On his first day in office, Tinubu ended fuel subsidies, resulting in an increase in the petrol price from about N200 per litre in May 2023 to approximately N700 currently.
To address this issue, Tinubu’s administration has invested in Compressed Natural Gas (CNG) to alter the current dynamics.
He stated, “We are a nation blessed with both oil and gas resources, but we inherited a dependency on oil-based petrol while neglecting our gas resources. We were also using our foreign exchange to subsidize this dependence.
“To remedy this, we launched our Compressed Natural Gas Initiative to power our transportation sector and reduce costs. This will save over N2 trillion monthly currently spent on importing petrol and diesel, allowing us to invest more in healthcare and education.”
Tinubu also announced plans to distribute one million low-cost or free CNG kits to commercial vehicle owners, who consume 80 percent of the imported petrol and diesel. The distribution of these conversion kits and the establishment of conversion centers across the country, in collaboration with the private sector, is expected to cut transportation costs by about 60 percent and help reduce inflation.
while licensed individuals have been importing diesel into Nigeria, the Nigerian National Petroleum Company Limited remains the sole importer of petrol under the current administration.
Despite being the largest oil producer in Africa, Nigeria depends on imported petroleum products due to low refining capacity.
In May, the President of the Dangote Group, Alhaji Aliko Dangote, said Nigeria would no longer import any fuel the moment his refinery commenced the production of petrol.
However, the Dangote refinery has been battling with crude challenges as international oil companies reportedly refused to supply crude to the facility.
Officials of the Dangote refinery stated that the Nigerian Midstream and Downstream Petroleum Regulatory Authority had insisted on fuel importation, granting licences to people to import dirty fuel into Nigeria.
Reacting, the NMDPRA Chief Executive, Farouk Ahmed, denied the allegations, stating that it was the Dangote diesel that had a higher sulphur content than the imported ones.
The NMDPRA boss warned that Nigeria cannot rely heavily on the Dangote refinery for its fuel supply, saying the importation of fuel would continue.
According to Ahmed, the refinery had requested the regulator stop giving import licences to other marketers to be the only fuel supplier in Nigeria, saying he refused to grant the request.
Meanwhile, Tinubu waded into the issue and ordered the supply of crude to Dangote in local currency, saying that would save the country over $660m monthly
