Lokpobiri: Petrol subsidy is gone — but NNPC can intervene occasionally

Heineken Lokpobiri, minister of state for petroleum resources (oil), says petrol subsidy has been scrapped but the Nigerian National Petroleum Company (NNPC) Limited can intervene occasionally.

On May 29, 2023, President Bola Tinubu said the petrol subsidy regime was over — a declaration that pushed petrol costs significantly higher.

Speaking on Wednesday during an interview on Channels Television to mark Tinubu’s one year in office, Lokpobiri said the petrol subsidy regime has been rightly exited.

He, however, said the president’s statement was misunderstood because provision was not made for petrol subsidy in the 2023 budget by the previous administration of former President Muhammadu Buhari.

“As the President has rightly said the day he was sworn in, the subsidy is gone. The president was misunderstood clearly,” the minister said.

“The last government, Buhari’s government did not make any provision for subsidy in the 2023 budget. Whether anybody is saying it or not, the subsidy was gone. What the president in his characteristic style was speaking truth to power.”

According to the minister, what Tinubu meant was that in the 2023 budget, “there is no provision for subsidy, so subsidy is gone”.

“And I can reconfirm to you that subsidy is gone, but there could be strategic intervention from time to time. Officially, subsidy is gone,” he said.

Asked what he meant by strategic intervention, Lokpobiri said in section 64 (m) of the Petroleum Industry Act (PIA), the Nigerian National Petroleum Company (NNPC) Limited, as a national oil company, also has a legal obligation to intervene from time to time.

According to the minister, this is because the NNPC is the last resort of the country that ensures there is availability and affordability of products.

Lokpobiri thanked Tinubu for having the courage to make the declaration on petrol subsidy.

On January 3, NNPC denied the return of petrol subsidy, saying it had been removed entirely.

However, on April 15, Nasir el-Rufai, former governor of Kaduna state, said the federal government is spending more on petrol subsidy than before.

Also, on April 16, Gabriel Ogbechie, chief executive officer (CEO) of Rainoil Limited, said the federal government now spends N600 billion monthly on petrol subsidy.

On August 15, 2023, TheCable reported Tinubu is considering a “temporary subsidy” on petrol as crude oil prices and foreign exchange rates continued to soar.