The Federal Government of Nigeria today, announced that it has ended petroleum subsidy.
The Minister of State for Petroleum Resources, Timipre Sylva made the announcement today, 9th July, 2020.
According to Sylva, the development is in accordance with the deregulation of the downstream oil sector. He added that the decision would boost the economic growth and development of the country.
The Minister stressed that the subsidy can no longer be sustained as continued subsidy added no value to the economy.
In his words,
“It has become expedient for the Ministry of Petroleum to explain misconceptions around the issue of Petroleum Products Deregulation. After a thorough examination of the economics of subsidising PMS for domestic consumption, the government concluded that it was unrealistic to continue with the burden of subsidising PMS to the tune of trillions of Naira every year.
“More so, when the subsidy was benefiting in large part the rich rather that the poor and ordinary Nigerians. Deregulation means that the government will no longer continue to be the main supplier of petroleum products, but will encourage the private sector to tae over the role of supplying petroleum products.
According to Sylva, the end to petroleum subsidy means that market forces will, in line with global practices, determine petroleum pricing.
He added that the measure will free up trillions of Naira to be channelled to other developments. It will also create more jobs and attract investments into the oil sector.