MOMAN Urges FG to Phase Out Subsidy, Avoid Shock

The Major Oil Marketers Association of Nigeria has called for gradual phasing out of fuel subsidy instead of a total deregulation following the current product scarcity being experienced across the globe.

The Chairman, MOMAN, Olumide Adeosun, made the call during a briefing with journalists on Wednesday.

According to him, the impact of the Russian/Ukraine war on businesses is “immense”, hence, the call on the federal government to gradually phase out subsidy to avoid “shock”.

Also Read: PMS: FG, IPMAN, Others Discuss Imminent fuel Hike

“The effect of the Russian/Ukraine war cannot be compared to what we experienced during the covid. What we are seeing is that countries are beginning to close borders against importers and products are being reserved for their own citizens alone. So Nigeria is also being shut out,” he said.

Speaking further, Adeosun said the Nigerian government has ran the subsidy regime for too long, adding that the huge fund reserved for subsidy should be diverted into growing other sectors such as Agriculture, health, education and others.

“The Federal Government has allowed subsidy for too long and we haven’t saved for the raining days. The subsidy keeps increasing to the tune of N4 trillion. Such money would have been invested into Agriculture, health, education and others”

The Senate had in April approved N4trn for fuel subsidy in 2022 following two separate requests by the Nigerian president to the National Assembly.

The MOMAN chairman further said selling petrol at N165 per litre is no longer sustainable due to the rising costs of diesel.

Findings showed that price of diesel had increased from N266/litre in October 2021 to above N800/litre currently.

“MOMAN is not short of empathy for Nigerians at this time. The association is pro-business, pro-progress and pro-human.

“We, therefore, stand for phased deregulation of the downstream sector because we don’t want subsidy to be removed all of a sudden in order not to throw the masses into shock. We can no longer sell petrol at N165 because diesel is what we use in our operations. We use diesel to power our trucks, run our stations and depots, and as we all know, price of diesel keeps rising.

“The options we have now is to either save our businesses by shutting it down, or that the government should allow a gradual phasing out of subsidy by allowing price increase gradually.

“It is better to have products at a slightly increased price than not have products at all. The money for subsidy should be injected into another sector. No government can make the current crisis go away because it is a global one, and we all have to adjust,” he said.

Additionally, the Minister of State for Petroleum Resources, Timipre Sylva, described the controversial subsidy regime as “a criminal enterprise.”