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Nigeria: Oil marketers warn FX shortage to trigger new petrol price hike

Published

9 months ago

August 14, 2023

Oil marketers in Nigeria have warned that an increase in the price of Premium Motor Spirit, popularly called petrol, is imminent following the fall of the country’s currency, the Naira, which now exchanges between N910 and N950 at the parallel market to the dollar.

The marketers claimed that the CBN’s Importers and Exporters’ (I&E) official window for foreign exchange, which has a lower exchange rate of approximately N740/dollar, had remained illiquid and was unable to offer the $25 million to $30 million needed for dealers to import PMS.

Thus, the marketers revealed that the scarcity of dollar in the official market means they were condemned to source from the parallel market which made product importation almost out of reach for them.

According to Chief Chinedu Ukadike, the National Public Relations Officer for the Independent Petroleum Marketers Association of Nigeria, the price of petrol is now determined by changes in foreign exchange, therefore, Nigerians should prepare for a rise shortly.

He further revealed that petrol prices could rise between N680/litre and N720/litre in the coming weeks should the dollar situation continue.

“If there is a gap in the naira against the dollar, there is going to be an effect,” he said in response to the question of whether oil marketers were considering raising the price of petrol.

Meanwhile, Executive Secretary of the Major Oil Marketers Association of Nigeria, Clement Isong, commenting on the fear of a possible hike in petrol price, stated that the government might have to intervene.

“Well, the President himself said in his speech that if they find petrol prices moving too high, they would intervene. We don’t want prices to move too high, nobody wants that.

“So if the dollar continues to climb, we are expecting some sort of intervention from the government based on what the President said,” he stated.

According to government data, Nigeria spent 4.39 trillion Naira ($9.7 billion) on fuel subsidies in 2022, with over ₦1.15 trillion reportedly spent in 2021.

However, President Bola Tinubu on his inauguration on May 29, announced the full removal of fuel subsidy, leading to a hike in fuel prices from N200 to between N518 and N630 per litre across the country. While some experts commended the removal, the removal has already triggered a cost of living crisis in the country.

Related Topics:Featured Nigeria Petrol subsidy President Bola Tinubu

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Uganda discusses power line to South Sudan with China’s Sinohydro

Published

18 hours ago

May 15, 2024

Ifeoluwa Dada

According to the president’s office, Uganda is in negotiations with Sinohydro Corporation Limited of China to build a $180 million power transmission line that would enable Uganda to export electricity to South Sudan, which is severely short on energy.

Ugandan President Yoweri Museveni received a group led by Vice President of Sinohydro Corporation Yang Yi Xin on Monday as part of the negotiations, according to a late-morning statement from Museveni’s office.

The project, according to the statement, will entail building a new substation and expanding two existing ones in addition to building a 138-kilometre high-voltage transmission line to provide power to South Sudan.

“We are very much willing to help develop this project with the required finance if needed,” Xin was quoted as telling the president.

The statement stated that Museveni endorsed Sinohydro’s proposal to carry out the project. Uganda and South Sudan inked a power sales deal in June of last year, enabling Uganda to sell electricity to South Sudan.

To enable Uganda to export electricity to South Sudan, the two nations inked a power sales deal in June of last year. The Chinese firm is completing a $1.5 billion, 600-megawatt hydropower project on the River Nile in Northern Uganda that is meant to be the source for electricity exports to South Sudan.

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Uganda considers nuclear energy to meet increased electricity demand

Published

19 hours ago

May 15, 2024

Ifeoluwa Dada

Uganda’s Ministry of Energy and Mineral Development announced on Tuesday that it was collaborating with the International Atomic Energy Agency (IAEA) to develop nuclear energy in the country as power demand rises.

Irene Batebe, permanent secretary of the ministry, stated that the government, with the assistance of the IAEA, is investigating and evaluating uranium deposits to ensure a sustainable supply of nuclear fuel for the projected nuclear power plants and research reactors.

“Uranium is the most widely used nuclear fuel material in nuclear power plants and research reactors and is required for Uganda’s nuclear power program.

“The planned nuclear power capacity will require about 4,000 tons of Uranium annually when fully operational. Thus, there is a need for sustainable sources of uranium,” she said at the opening of the nine-day meeting with the experts from the IAEA.

Batebe stated that the government is modifying the Atomic Energy Act of 2008 to tighten the legal framework for the exploration, mining, and processing of nuclear fuel reserves. She stated that even if completely exploited, the country’s electricity generation capacity from hydro, biomass, geothermal, and peat will fall short of Uganda Vision 2040 ambitions.

“To meet our development targets, nuclear energy among other sources must be integrated in the electricity generation mix,” she said.

The Cabinet approved the Energy Policy for Uganda, 2023 in April 2023, which envisions the long-term development of 52,481 MW of generation capacity to meet future demand, with nuclear power accounting for 24,000 MW.