Tinubu Administration’s Monthly Petrol Subsidy Hits ₦1 Trillion, Reveals Pinnacle Oil MD

At the Nigeria International Energy Summit, Robert Dickerman, the Managing Director/CEO of Pinnacle Oil and Gas Limited, disclosed that President Bola Tinubu’s administration is currently paying a staggering ₦1 trillion monthly as petrol subsidy.

This revelation comes as the government attempts to deregulate the downstream sector in line with the provisions of the Petroleum Industry Act (PIA).

Dickerman pointed out that the government is still paying a massive subsidy, which explains why the product is still being smuggled to neighbouring countries.

The cost of gasoline in Nigeria is the lowest in Africa, encouraging smuggling and depriving Nigeria of value.

This smuggling further hurts the entire budget, Federal and State, as critical programs cannot be funded to pay this subsidy.

While the decision to end the subsidy regime during President Tinubu’s inaugural speech on May 29, 2023, instantly led to an astronomical increase in fuel pump prices, the current price of fuel per litre in Nigeria should have increased from around ₦600 to over ₦1,000, indicating that the government is surreptitiously paying a subsidy on the commodity.

Dickerman emphasized the need for a national policy to transform Nigeria’s economy, regulations, and laws to accommodate and encourage Foreign Direct Investment (FDI).

Foreign investors, foreign lenders, and government-run DFIs have been clear about their expectations: conservative fiscal policy, tackling corruption, enabling competitive markets, and enforcement of fairness in markets through policy, regulation, and the ability to enforce contracts.

As the country navigates this challenging time, it is essential for the government to address the concerns of foreign investors and lenders, while also ensuring that Nigeria’s economy does not suffer due to the massive petrol subsidy.