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Published On: Wed, Nov 7th, 2018

Atiku’s promise to crash fuel price to N97 laughable, sign of desperation – Kiyamo

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By Umar Muhammad Puma

President Buhari Campaign Organisation has described as “laughable and evidence of desperation and phantom promises” a statement credited to the opposition Peoples Democratic Party (PDP) and its Presidential candidate, Alhaji Atiku Abubakar that they will crash fuel price from N145 per litre to N97.
The PDP and Atiku were reported to have promised, in a statement, to reduce the pump price of Premium Motor Spirit (PMS) to N97 per litre, if Atiku is elected president come February 2019.
However, the Buhari Campaign Organisation, in a statement issued yesterday by its director of strategic communication, Festus Keyamo, said the claim by Atiku Abubakar is opportunism of the highest order; adding that Nigerians are aware that higher crude oil price will translate to higher government revenue; and a prudent administration will convert the resources to the benefit of the common man.
“There is no better evidence of desperation and phantom promises by the main opposition’s candidate than this statement. At today’s international price of gasoline, no supplier will ever contemplate any scheme that will deliver products at such ridiculous price. Those in the sector reading this must be having a good laugh at the opposition.
“A simple check at the international prices will show that even at the world market where gasoline is procured, it will cost not less than N158 to procure a litre of crude oil. When you add the cost of refining, plus freight, finance and port charges (premium), there is no magic that one would employ to supply the finished product at N145 a litre. Presently, the landing cost of the product in Nigeria hovers
around N205 per litre.
“What obtained under the past government was the ABUSE of the subsidy regime. The system under the past Government was that independent marketers and all sort of persons were allowed to import petroleum products on their own, declare non-existent volumes of these products and get paid for these non-existent volumes, and government would then pay them cash for the “loses” (subsidy) in selling at fixed market price.
He said under the PDP’ administration, N3trillion was lost to independent marketers and the same marketers could no longer bring in products due to high prices of crude and make profit at the fixed market price of N145 to a litre.
“President Buhari refused to further raise the price of petroleum products beyond the N145 per litre. The President was also not prepared to go back to the subsidy regime. Therefore, President Buhari stopped the scam of overblown volumes and subsidy payments to middlemen. As a result, NNPC took full charge of getting products for consumption.
He explained that under this arrangement, the NNPC would swap crude oil for the exact value of finished products in refineries anywhere the products are available around the world, and middlemen are only allowed to go and ferry the products and bring into the country and hand over to NNPC.
“NNPC will only then pay them for the cost of the logistics of bringing the products in (this is what is called premium), even this cost of logistics is now subject to competitive bidding unlike before.
“In the past, marketers used to charge $86 per metric ton as cost of logistics (premium) to bring in products. under Buhari’s regime when it was subjected to competitive bidding, the highest the government got was $7 per metric ton as cost of logistics to bring in products.
More than N3billion has been saved by this bidding process.
“Having gotten the value of the crude oil back in terms of finished products, NNPC will now sell at government controlled price which is far lower than the landing cost. Presently, the landing cost is around N205 per litre, but government sells at N145 per litre.
“Therefore, Government just records a loss in NNPC instead of paying cash to middlemen. That loss it suffers is fully reflected when NNPC pays money into the Federation Account. This also further affects the money accruing to States monthly from the Federation Account.
“As a result, this loss that NNPC suffers, (which is recorded as cost of operation of NNPC) is fully subjected to scrutiny by the National Economic Council which also includes the PDP Governors and the Federation Accounts Allocation Committee (FAAC), which includes Commissioners of Finance from PDP States.
He dismissed allegations that President Muhammadu Buhari is paying subsidy to marketers.
“It has become necessary for Nigerians to interrogate Alhaji Atiku Abubakar further in order for him to lay bare before the Nigerian people the so-called “template” he has developed to crash the price.
This is not a game of tricks or hide-and-seek. He must come clean.
Nigerians await the details of the transparent system Alhaji Atiku Abubakar intends to adopt that would eliminate fraudulent cash payments to middlemen and make the product available at all times.

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