The President of the Independent Petroleum Marketers Association of Nigeria (IPMAN) has blamed extortion by security agencies and arbitrary levies by government agencies as reasons for the recent increase in fuel prices in the country. Speaking at a public hearing organized by the House of Representatives, the IPMAN President stated that apart from international pricing, these factors have contributed to the rise in fuel prices from N537 to N617 per litre.
He also mentioned that Nigeria is now under the regime of the Petroleum Industry Act, and the market is driven by reality. The IPMAN President highlighted the cash-trapped situation of IPMAN members due to unpaid debts from Nigeria’s oil giant, NNPCL, amounting to about N250 billion.
In response to the challenges faced due to the removal of fuel subsidies, the IPMAN President recommended a switch to Compressed Natural Gas (CNG) as a permanent solution to address the rising cost of Premium Motor Spirit (PMS) and ease the economic burden. He emphasized that Nigeria has vast quantities of gas and suggested that funding and technology deployment could provide relief from high petrol costs within a short period. Transitioning to natural gas would attract global investments and reduce emissions, making it a sustainable alternative to the current petrol consumption.
The House of Representatives Ad hoc Committee on the Recent Hike in Petrol Pump Price was established to investigate the reasons for the fuel price increase from N537 to N617 and its impact on the economy and citizens. The committee aims to ensure that the hike does not have a devastating effect on Nigerians and will be transparent and objective in its reports.
This solution lies in the Central Bank of Nigeria (CBN), in it lies a N250 billion gas expansion facility.
“The objective of that facility is to support the utilisation of natural gas; we have written to CBN since last year way ahead of subsidy removal, we have had meetings convened by the former Finance Minister and the CBN, NNPC and other stakeholders and we told them the solution to subsidy removal can be implemented in one day.
“Nigerians, vehicle owners and state government should be given access to the borrow N200,000 to convert their vehicle or tricycle from that N250 billion.
“That will catalyze investments along the value chain because you need to have a large pull of converted vehicle to justify the investment to deliver that gas to every part of the country.
“The solution is here, we have been preaching this since last year, the government does not have to do anything new; there is funding at CBN to support this.
“The only way natural gas can be a substitute is be providing loans for vehicle users; every country that transitioned from petrol subsidy to natural gas India, Egypt, Bangladesh, Iran either gave free kits, subsidies the kits or give access to loan to make it easy for people to convert vehicle and catalyse investments,” he said.
