The Federal Government subsidy on Premium Motor Spirit, popularly known as petrol, has risen to N47.5 per litre, as the crude oil price increased to $67.86 per barrel yesterday, data from the Petroleum Products Pricing Regulatory Agency disclosed.
The data disclosed that PPPRA’s PMS pricing templates for December 12, 16, 17, 18, 19 and 23 put the expected open market prices of petrol per litre at N172.92, N177.33, N177.32, N174.81, N177.92 and N180.78.
But the ex-depot price for collection of petrol, as captured in the templates, remained at N133.28 per litre, indicating that the NNPC subsidised the commodity by an average of N47.5 per litre during the review period.
But IMF frowns at increasing subsidy
The International Monetary Fund, in its latest Regional Economic Outlook, called on Nigeria to reduce fuel subsidy in order to boost productive government spending.
It said, “Fuel subsidies tend to be poorly targeted, foster over-consumption, curtail investment and maintenance in related sectors, and crowd out more productive government spending. Some countries need to take the opportunity afforded by low oil prices to reduce fuel subsidies to free up additional fiscal space (Cameroon, Nigeria, Senegal), as was done in Mozambique and South Sudan and are being pursued by Burkina Faso.”