Sunday Dare, special adviser to President Bola Tinubu on media and public communications, has defended the administration’s 30-day petrol price discount.
In a statement on Sunday, Dare said former Vice-President
Atiku Abubakar’s criticism of the Nigerian National Petroleum Company (NNPC)
Limited’s decision to extend its petrol discount reflected a misunderstanding
of global energy markets and Nigeria’s crude oil production arrangements.
He described Atiku’s proposed production subsidy as a
“dangerous mathematical fantasy wrapped in political deceit”.
Atiku had criticised the government’s approach to rising
petrol prices, arguing for a production subsidy as an alternative to the
current framework.
The presidential candidate of the African Democratic
Congress (ADC) accused Tinubu of copying his proposal on petrol subsidy but
limiting the measure to a 30-day discount.
He also argued that Nigerians needed long-term relief,
describing the discount regime as “panic-driven publicity stunt”.
But Dare said Nigeria could not afford a blanket production
subsidy because the government did not have unrestricted access to all the
crude oil produced in the country.
He said Nigeria produces about 1.8 million barrels of crude
oil per day, but has fewer than 700,000 barrels available to the state after
accounting for contractual obligations under joint ventures and
production-sharing contracts.
“To propose a blanket ‘targeted production subsidy’ on crude
without the physical, unencumbered volume to back it up is pure economic
illiteracy,” Dare said.
According to Dare, using crude oil to subsidise domestic
production without accounting for these commitments could undermine government
revenue and revive the opacity associated with the former petrol subsidy
regime.
He also argued that domestic refineries, including the
Dangote Petroleum Refinery, require more crude oil than the government can
freely allocate without affecting existing supply contracts.
Dare said the NNPC’s decision to forgo its retail profit
margin for another 30 days was a temporary measure to cushion consumers against
rising global oil prices, rather than a return to the former fuel subsidy
system.
He described the intervention as “a market-smoothing price
modulation framework, not a return to unbudgeted federal spending”.
He added that the government had negotiated an interim
ceiling of N1,350 per litre on ex-gantry costs, under which refiners and
importers would absorb cost increases above the threshold and recover them
later when market conditions improve.
According to him, the arrangement is intended to moderate
sudden petrol price increases and prevent transport fares from rising sharply
whenever fuel prices climb.
“N1,400 today and N1,400 tomorrow provides far greater
economic stability than N1,500 today and N1,300 tomorrow,” he said.
He said the administration was also pursuing longer-term
measures, including expanding compressed natural gas infrastructure and
establishing a strategic energy reserve to improve supply security and reduce
exposure to global market shocks.
Dare maintained that the removal of petrol subsidies and the
unification of the foreign exchange market were necessary to address
longstanding economic distortions, adding that the reforms had increased
allocations to state and local governments.
He accused Atiku of exploiting economic hardship for
political gain, describing his criticism as “election-laced demagoguery”.
“Chronic economic ailments built over thirty years cannot be
cured by populist slogans or 30-day electioneering promises,” he said.
Dare said Nigerians should assess the administration’s
policies against the country’s long-term economic needs rather than promises of
immediate relief.
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