Tinubu Insists ‘Fuel Subsidy Is Gone’, Despite NNPCL’s Admission Of $6billion Debts
Despite the admission of the Nigerian National Petroleum Company Limited (NNPCL) to debts due to the rising cost of petroleum and the financial burden this has placed on it, President Bola Tinubu’s aide, Bayo Onanuga has claimed that the government is not paying fuel subsidy.
NNPCL had admitted to owing petroleum suppliers to the tune of $6 billion due to “financial strain from the costs of petroleum supply.”
Instead Bayo Adenuga stated that what was done by the NNPC was absorbing price of petroleum to protect Nigerian consumers “commendable disposition of the oil company owned by all the tiers of government to absorb the rising costs of petrol at the pump and protect the Nigerian consumer” according to a post he shared on X.
It is unclear how what he described is different from subsidy, which is also the government absorbing price of petroleum.
His statement on X reads below.
“I have read a series of articles attacking the Federal Government for not telling the truth about fuel subsidy payments, following NNPC Limited’s admittance it was owing suppliers some $6 billion.”
“Some of the stories have been written with relish, as the authors believed they have uncovered some scoops.”
“The truth is that there is no discovery. No lie uncovered. The government has been faithful to its policy that it was no longer going to pay fuel subsidies since President Tinubu announced the deregulation of the PMS sector on 29 May 2023. Since then, subsidy provisions have disappeared from the budget.
“It was not in the Supplementary budget of 2023, not in the 2024 budget and the amended 2024 budget.”
“So the giddy headlines about the so-called unraveling of the Tinubu government’s subsidy payment; and return of subsidy were not justifiable.”
“Rather what has unravelled was the commendable disposition of the oil company owned by all the tiers of government to absorb the rising costs of petrol at the pump and protect the Nigerian consumer. That generous disposition by NNPC Limited, backed by a compassionate president unwilling to let the people suffer, has been under threat for months, because of the rising cost of crude and the devalued Naira.”
He stated that NNPC only cried out because it could no longer pay the differential between landing cost and actual cost of petroleum without going insolvent.
“The NNPC cried out recently because it can no longer sustain the price differential on its balance sheet without becoming insolvent. The situation has greater implications for the ability of the three tiers of government to function as the NNPC has failed to pay into the Federation Account, the money that should go to the government.”
“There are no easy choices. Something must be done to make NNPC survive, keep the engines of government running and petrol flowing at the pumps. That is the scenario that is unfolding and the game changer and big relief giver may well be the Dangote refinery and other local refineries which will become the fuel suppliers to the local market.”
“When Dangote Refinery and other refineries, including government owned Port Harcourt Refinery, come fully on stream, our country and economy will benefit on all fronts. There will be many good paying jobs that will be created along the value-chain. There will also be a drop in the huge demand for foreign exchange to import petroleum products.”
In a statement signed by the company’s Chief Corporate Communications Officer, Olufemi Soneye, on Sunday, the company had acknowledged recent reports in national newspapers regarding the company’s significant debt to petrol suppliers.
“This financial strain has placed considerable pressure on the company and poses a threat to the sustainability of fuel supply,” it added.
Tinubu government did not lie about fuel subsidies
I have read a series of articles attacking the Federal Government for not telling the truth about fuel subsidy payments, following NNPC Limited’s admittance it was owing suppliers some $6 billion.
