Gasoline Landing Now Costs N278, MOMAN Says Crude Reaches $ 80
The Major Oil Marketers Association said the landing cost of gasoline jumped to N278 as the price of crude oil in the international market hit $ 80 on Tuesday, with experts fearing the subsidies would increase.
The international benchmark for crude oil traded at $ 80.02 a barrel, its highest level since October 2018, at 12:09 p.m. Nigerian time on Tuesday, according to Oil Octobers. Brent had fallen to $ 78.89 a barrel as of 7:14 p.m. Tuesday, while US West Texas Intermediate traded down 0.45% to $ 75.11 a barrel.
The Executive Secretary and CEO of MOMAN, in a phone call with our correspondent, said: “The last time we checked in September, the spot price if we assume an exchange rate of N410 for a dollar you have a landing cost of N278 per liter.
“The truth is that as long as we continue to subsidize the price of fuel, we are borrowing money to consume. This means that we are short selling future generations. We need to embrace mass transportation to reduce per capita fuel consumption and also reduce our dependence on imports to reduce stress on the naira. ”
A PUNCH The report previously said gasoline subsidy payments amounted to N905.27 billion in eight months, according to data from the Nigerian National Petroleum Corporation. Nigeria did not meet its August quota set by the Organization of the Petroleum Exporting Countries and its allies.
This has raised concerns about a double strain on the country’s finances in terms of increased subsidy payments without a corresponding increase in crude oil revenues.
The Managing Director of Geoplex Drillteq Limited Group, Mr. Wole Ogunsanya, told our correspondent that the country has not met its quota due to lack of investment and poor asset management.
He said: “The issue of OPEC quotas is very simple; we are not working hard enough. Oil on the ground is like a swimming pool; if you take water every day without replenishing it, it will continue to decrease until it runs out.
“We are not reaching the OPEC + quota because either we are not producing or when the price collapses, we have stopped drilling new wells, repairing the old ones.
“Unless we keep investing in the upstream oil and gas subsector, the amount we produce will not be enough. The subsidy payment will now increase because with the price set at N 165 per liter, the increase in crude prices would mean that we will pay more per liter of fuel imported into the country. ”
Ogunsanya said that until Nigeria produces and refines locally, repairs its refineries and builds more, subsidy payments will continue and be subject to the price of crude oil in the international market.
Oil and gas industry analyst Mr. Bala Zakka said Nigeria needs to fix its economic model when it comes to oil.
He said most of the OPEC + countries had refineries and could benefit from rising crude prices, but Nigeria might not have, due to current circumstances.
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