By Adaobi Rhema Oguejiofor
Professor Omowumi Iledare, an Expert in Petroleum Economics and Energy Policy, has faulted the recently released fuel pricing framework by the Nigerian National Petroleum Company (NNPC) Limited, describing it as a dominant-firm market behaviour.
Iledare made this known in a chat with the media on Thursday, during which he insisted that the act is basically anti-competitive and derived from an import-market monopoly structure for Premium Motor Spirit (PMS).
In his own words, “NNPCL is basically indirectly setting the price of PMS as a dominant firm in the downstream market, which is really not an action that is supported by the Petroleum Industry Act (PIA) 2021. Unfortunately, the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which ought to have checked such a firm dominant behavior is handicapped. It is now publishing its price just because President Bola Ahmed Tinubu inadvertently said what he should not have said. This action seems authoritarian and non-transformational.
“I guess that a presidential pronouncement has now become synonymous with a petroleum policy pronouncement of the Federal Government. I think this, perhaps, explains why PIA 2021 was disregarded since August 2021 as a result of the pronouncements of President Muhammedu Buhari on subsidy.”
Iledare also stated that a democracy as big as that of Nigeria cannot be governed on the basis of political expediency, adding that the immediacy with which NNPCL released the new pricing framework is worrisome.
“The Authority and perhaps the Consumer Protection Agency needs to ensure that Consumer surplus has not been compromised. This is just an opinion,” he said.
In the same vein, the Publisher of Valuechain Energy Magazine, Musa Bashir Usman, has also said that NNPC seems to be rushing the process .
According to him, “they have forgotten that they are the ones who brought us to this situation due to their inability to manage our refineries well. I was shocked by the speed at which they withdrew the subsidy without allowing the President to issue the guideline for the final withdrawal.
“The body language of Mr. President, following the pronouncement, shows that he intended to continue with the process started by the last administration, which does not imply an outright subsidy removal and capping of fuel price for others to follow.”
This comes after the meeting of the Nigerian Labour Congress (NLC) with the Federal Government hit a deadlock, following several hours of deliberations. The Union demanded that the government return to status quo by reversing the price of fuel before resuming negotiations with them on protecting the Nigerian workforce and proffering additional solutions.
NLC further insisted that the Presidency, before taking the decision to remove fuel subsidy, did not enter into any conversation even on palliative measures for Nigerians, which is why they are rejecting its latest announcement.