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Osinbajo says new petrol price not issue of subsidy removal but forex problem

The Vice President, Prof. Yemi Osinbajo, on Friday, said that the new price regime of Premium Motor Spirit (PMS) was not that of subsidy removal but of foreign exchange (forex) problem.

He made this known in a statement he issued in Abuja titled “The Fuel Pricing Debate: Our Story”, stressing that

“I have read the various observations about the fuel pricing regime and the attendant issues generated.

“Certainly, all the issues have strong points but the most important issue is how to shield the poor from the worst effects of the policy which I will address in another note.”

Giving further explanation on the new petrol policy, the vice president declared that “the real issue is not the removal of subsidy because at 40 Dollars a barrel, there isn’t much of a subsidy to remove.”

According to him, President Muhammadu Buhari is probably one of the most convinced pro-subsidy advocates, narrating that “what happened is as follows: our local consumption of fuel is almost entirely imported.

“The NNPC exchanges crude from its joint venture share to provide about 50 per cent of local fuel consumption and the remaining 50 per cent is imported by major and independent marketers.

“These marketers up until three months ago, sourced their foreign exchange from the Central Bank of Nigeria at the official rate and since late last year, independent marketers brought in little or no fuel because they have been unable to get foreign exchange from the CBN.

“The CBN simply did not have enough foreign exchange.”

He explained that in April, oil earnings dipped to 550 million Dollars and the amount required for fuel importation alone was about 225 million Dollars.

The vice president noted that NNPC tried to cover the 50 per cent shortfall by dedicating more export crude for domestic consumption.

He, however, added that besides the short term depletion of the Federation Account, “which is where Federal and state governments are paid from, further cash-call debts keep pilling up” and NNPC lacked the capacity to distribute 100 per cent of local consumption nationwide.

Osinbajo wrote that before this time, NNPC was responsible for only about 50 per cent, which was part of the reasons for the lingering scarcity of petrol.

“We realised that we were left with the only option of allowing independent marketers and any Nigerian entity to source for foreign exchange and import fuel.

“We expect that foreign exchange will be sourced at an average of about N285 to the Dollar, (current interbank rate) and importers will then be restricted to selling at a price between N135 and N145 per litre,’’ he added.

The vice president said the Federal Government expected that with competition, more private refineries and NNPC refineries working at full capacity, prices would drop considerably, stressing that “our target is that by fourth quarter of 2018, we should be producing 70 per cent of our fuel needs locally.

“At the moment, even if all the refineries are working optimally, they will produce just about 40 per cent of our domestic fuel needs,’’ he explained.

Osinbajo said he avoided mentioning other details of the Petroleum Pricing and Regulatory Agency (PPRA) cost template but rather focused on the cost component largely responsible for the substantial rise, namely foreign exchange.

“This is therefore, not a subsidy removal issue but a foreign exchange problem in the face of dwindling earnings,” he emphasised.

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About Charles Igbinidu

Charles Igbinidu is a Public Relations practitioner in Lagos, Nigeria

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95 comments


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    The Politician Is Talking; Not The Pastor. Politics Has A Way Of Inducting, Baptising And Teaching The Best Of Men Its Vocabulary! Welcome, Pastor.


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    Indirectly he is saying they are still paying subsidy at 145 right but just that forex isn’t available. What is this man saying? I’d always thought Osinbanjo is reasonable enough as a prof and a pastor to say the right thing at the right time but seem since he joined politics his brain has bn touched and his conscience blocked frm seeing the truth and saying it. He now makes stupidy and lies his best companion. Sir trace back ur steps u are a disgrace to Christianity and priesthood.


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    Pst no heaven for u period, I am not judging. Bye


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    Pastor , use long spoon on this political dinning table now’


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    Sir pls don’t cause more confusion to d existing one..


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    Do you and Mr President buy fuel?


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    How do we understand this for goodness sakes.


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    Which one do we take now ? One is talking subsidy another Forex. Haaaaa, All Promises Cancelled Party. There is God ooooooo.


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    You can listen through your anu if you want to understand him bigots.


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    Carry on my abled vice President, I know you can do it.


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    This is confusing, pls our leaders where are u paddling d nation boat to? It will be very bad if u drilldabling d citizen of ur nation. Whom do we believe now? Is it PMB or his vice Osinbajo. That was y some private marketer still selling their pump price at d rate they like i.e #150, #160 up to #190. This means the FG is teasing us. There is God o o o o o o.


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    He is a disgrace to Christianity n his profession as a prof of law.Talking as if he is semi illiterate.


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      You are not better than him. You Olodo.What do you know about economy and Governance.Noise making.


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      I can’t be a push n start professor n ceremonial vp like him. Cow like u Bickersteth Toyin


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    Pastors…..na dem lie pass especially those involve in politics


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    Dangers of Leadership Apprenticeship. Where was Forex when GEJ wanted to do what you have just done, and you stiffly resisted him. You Occupied Nigeria at that time….waw


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    Pastor anything way you talk now werether na lie o or na true, na watin the previous govt won do before and you people no gree and ona also invite musicians to compose song for the previous govt. Abi no be so?


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    confusion has sent in so must death claim u all..


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    This guy has lost it. Hardly tell the truth i wonder if he was a pastor like initially said. He is a liar


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    Osibanjo has lost focus , sme times whn lies is no possible just keep ur mouth shot or u ask Lai mohamed to lai to us, sir dnt try to lie ur a pastor 4God sake or is it true u av resign? Simply try to pacify ur citizens gv them word of incouragment ,pray 4thm in ths difficult period ur party&govt av subjected us to. We v always lived on hope one day God ll intervain 4us.


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      y not u say Buhari should also pray for nig and even u that may God almighty allah should bring GMB an prof osibanjo back nex tenure


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    Confusion every where in this administration of APC led by PMB!


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    We support deregulation !! Time will tell . The greatest weapon is truth .


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    This people has brain problem.


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    You have an explanation to make to Kamar on the long run.


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    A prof san and a pastor bt under an illiterate nd directed by an illiterate


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    We Nigerians are in a fix under this administration . God please deliever us.


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    its seems some muslims frm north are now supporting pastor osinbajo…lolz i cant just stop laffin, cos i dnt knw the day hausas and fulani develop love for a yoruba pastor, is it because he is under ur person and he is acting as pmb mouth piece?


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    cheap lie from so called pastor,say the truth stop deceiving yourself


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    I am disappointed in you Richard, have you read his full statement. You just jump into a wild conclusi on. If you are bitter that does mea n you should say stupid statement And by the way who tells you that Oshibajo is a disgrace to Christiand oom.Whoever you maybe you lack moral upbringing to talk to an elderly man and the leader of our country the way you do.


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      But you said worst things to jonathan


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      Check your mail and quote!Worst of all the man I replied happens to be a Yoruba man who suppose to be naturally taught to respect an elderly people according to our culture.


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    Yemi osimbanjo, debe sigga were Bible……..


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    Now we are hearing the truth and facts behind the increase. So we should assume this not to be the end cos the fx rate will worsen beyond its current rate.
    Also in agreement with IMF to devalue the naira. You can resist if you don’t understand but economic theories are true and truth that must be compiled with to ensure prosperity of any nation.


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    This one de like house boy or Peaken self


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    Confusion all the way..today one story, tomorrow another one..chai


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    ALL PROMISES CANCELLED… APC. but I pity my pastor oo


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    U don remove am no dey bring all dis big big talk again…


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    Hahaha, he is the vice president of nig not the vice president of christianity ok


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    When a pastor, rev, clergy or bishop join polities what would you expect? He will behave worldly


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    osinbajo did u have a first school leaving certificate?


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    Being a professor does not mean one is reasonable.


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    HE IS NEITHER THE INFORMATION MINISTER NOR PRESIDENT BUHARI WHO HOLDS THE PORT FOLIO AND WHOSE DUTY IT’S TO EXPLAIN OUT THIS MAJOR DEVELOPMENT. ….IS THE VP SAYING THAT SUBSIDY STILL EXISTS. ….OR THAT FUEL PRICES SHOULD NOW BE SUBJECTED TO THE VAGARIES OF THE EXCHANGE RATE. …..IN A COUNTRY WITH UNSTABLE CURRENCY RATE…..OR BOTH…MEANING FUEL PRICING SUFERING THE DUO IMPACTS OF EXCHANGE RATE AND SUBSIDY.


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    I thought this man is a pastor…


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    The truth of everything is that the economy has gone out of PMB control -Liar Mohammed.
    The same time, the technocrats among us warned him earlier before now to devalue naira from 199/1$ to 250/1$ but APC’s and their economic team thought everything is all about politics. What’s the result now, uncontrollable falling of our forex .
    They must appreciate GEJ because a stitch in time could have saved Nine if not for our stubbornness in 2012.
    From what VP Osibanjo is saying now, it means by time this administration will finally remove subsidy, fuel will be sell at =N250 to =N300 per litter official price.
    Time shall Tell


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    This man is an educated fool i have notting to say more


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    Their reason is foolishness!


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    Buhari has successfully conterminated Osinbajo with ignoramus status. They should just revert the pump price or face shut down next week.


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    Pastor osunbande, is this how you are going to pight kwaraption?,(speaking in buharia tongue).. When is this season film going to be over?, one year gone and na story we still dey hear on empty stomach and sufferness


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    Laier pastor in politics hahaha do you read your Bible again?


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    My able pastor God will have mercy on you and forgive all your sins


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    Bunch of incompetent people


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    Nigerians are difficult to rule.Just try your utmost best with PMB & God Almighty will solve the remaining problem for us.


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    Sir @ baba u and ur master done old so both of u supposed to resign from d power


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    Hahahahaha,evn profession osibanjo is a block head like gmb


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    Zombie na zombie@VP AND GMB


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    Osimbajo is a coward


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    I’m sure this man is even confused about what he is saying, thank God I didn’t vote for this set of crooks..


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    What did a pastor know about government


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    Temitope D. My brother any Pastor in Nigerian politics is a dirty pastor because politics they said it’s a dirty game. Leave talk jareeeeee


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    Make we hear something! Failed government!


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    This government has no cohesion at all the vice president says one thing the President says another while the minister says another thing, we are inside one chance government


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    Mumu talk. Refineries should be what we should be talking about. You have no business being in government


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    Buhari government is bunch of jokers and fraudsters


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    If this statement is true,,it means more confusions for Nigerians..


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    Idiotic and fasticatilly corrupt rullers


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    You are deceiving the citizen. Why did you promised us downward review to #40 during the campaign. It means you were just promising without basis and knowledge of what awaits you in office. You simply did not plan to govern but merely use lies, propaganda and deceit during campaign.


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    As forest is jumping up again , we will jump follow it, Which means it will go up more, as dollar is still, going up


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    Pastors don’t usually lie, I am disappointed.


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    WHO ARE YOU? WHAT DO YOU STAND FOR?
    1. Buhari said he would pay unemployed citizens. You clapped
    He said he cannot pay unemployed citizens. Also clapped
    2. Buhari said he does not know anything called subsidy. You clapped
    He paid subsidy. you also clapped.
    3. When he removed all road blocks. You clapped.
    When he reinstalled road blocks. You also clapped.
    4. When he relocated military command to North East. You clapped.
    He returned military command back. You clapped
    5. He said he would never devalue the Naira. You clapped.
    He devalued the Naira. You clapped.
    6. He said he would not have the office of the first lady. You clapped.
    He has the office of the first lady. You clapped
    7. He said he will make N1 equals to $1. You clapped
    $1 is officially equal N360. You are clapping
    8. He said he will end Boko Haram insurgencies 3 months into his regime, he later said in December when the rains stop. You clapped.
    Today, Boko Haram is still killing people. You are clapping.
    9. He said he would turn all presidential jets to national carrier. You clapped.
    Today, he and his family are cruising on all presidential jets. You are clapping
    10. He said he would build one new refinery each year. You clapped.
    Its getting to one year, no refinery has been built. You are still clapping.
    11. Buhari first went to England and he took pictures with Cameron. You. Clapped.
    Buhari went to England and he was disgraced by Cameron. You also clapped. These kinda persons among us should be struck and buried alive by thunder and brimstone!


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    Livn in a Confused system of GOVT.


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    Lol pastor so you no fit tell the truth?pastor pastor pastor chai you done forget bible na


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    You are a chameleon Sir. Still doubting if you are really a pastor. They have brainwashed you. No wonder he used to hand over the affairs to his media aids each time he wants to travel. It shows that he don’t even trust you.


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    Pastor Tunde Bakare wouldn’t have been bisbehaving like Osibanjo as a Vice president


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