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Nigeria’s NNPC spent $9.7 billion as subsidy on ‘scarce’ petrol in 2022

Published

2 years ago

January 21, 2023

The latest data from the state-owned firm, Nigerian National Petroleum Company Limited (NNPC), Nigeria spent 4.39 trillion Naira ($9.7 billion) on a petrol subsidy last year.

The figure is a far rise in petrol subsidy payments reportedly gulped over N1.15 trillion in 2021 alone,

The data also confirmed the government’s initial position the NNPC did not remit funds to federal accounts last year. The government maintained that the expended subsidy is the cause of Nigeria’s recent dwindling public finances.

Nigeria’s NNPC has been the subject of immense corruption allegations, so much that President Buhari on coming into the office on the mantra of fighting Nigeria’s neck-deep corruption, made himself the Minister of Petroleum, perhaps to face the menace in the oil sector head-on having been a Minister of Petroleum Minister during past military government in Nigeria.

Nigeria is producing well below the nation’s OPEC quota of 1.8 million bpd, due in large part to theft from pipelines that have curtailed production.

Industrial-scale oil theft is also another reason for Nigeria’s revenue shortfall. Nigeria’s oil auditing agency, NEITI, indicated that in 2019, the West African country lost 42.25 million barrels of crude oil to oil theft, valued at $2.77 billion.

Finance minister Zainab Ahmed has said the country will keep its costly but popular petrol subsidy until mid-2023 and set aside 3.36 trillion naira ($7.5 bln) to spend on it.

Despite her increasing debt profile, Nigeria’s government in January 2022 postponed its planned removal of subsidies on petroleum products till further notice.

FUEL SCARCITY

Meanwhile, Nigerians have been having a tough time purchasing premium motor spirit (PMS) popularly known as petrol for over four months. Petrol stations across the country have been greeted with long queues which usually prolong into streets and major roads across the country, thus causing gridlock as it affects the flow of traffic.

Petrol stations currently sell the product for as high ₦300, almost double the official subsidised regulated price of ₦175. There have been no clear official reasons for the prolonged scarcity as Nigerians continue to suffer from the pains of the uncertain cost, the resulting traffic situation and other risks caused by the situation.

Related Topics:Featured Fuel subsidy Nigeria

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VenturesNow

Moroccan annual inflation rises to 0.8% in November

Published

1 day ago

December 21, 2024

Ifeoluwa Dada

Morocco’s statistics office has confirmed that the country’s annual inflation rate, as determined by the consumer price index, increased from 0.7% in October to 0.8% in November.

Monthly, consumer prices decreased by 0.2% from October.

The primary driver of inflation, food costs, grew by 0.8% compared to the previous year, while non-food inflation climbed by 0.7%. Core inflation, which does not include more erratic items like food, increased 2.6% annually and 0.2% monthly.

According to the central bank, inflation is expected to average 1% this year, down from 6.1% last year.

Despite the Al-Haouz earthquake, a spike in inflation, and worldwide economic challenges, Morocco’s GDP grew by 3.4% in 2023.

A recovery in tourism, robust industrial exports, and rising private consumption—all bolstered by prudent macroeconomic policies—were the main drivers of growth.

VenturesNow

Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

2 days ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”