Petrol may rise as Senate deletes equalisation fund from PIGB, Nigeria loses $55b in 10 years

Nigerians living far from petroleum depots or in mountainous and riverine communities may be burdened with high price of petroleum products, especially Premium Motor Spirit (PMS) otherwise called petrol if President Muhammadu Buhari signs into law the current version of the Petroleum Industry Governance Bill (PIGB).

Already, the Senate has expunged the Petroleum Equalisation Fund (PEF) from Part IV of the piece of legislation. The implication is that consumers would have to pay for the price parity, which the fund has addressed since 1975.

Indeed, key programmes being planned by the agency are current stalled due to uncertainties on the continuity of the agency.

PEF came into existence to primarily address challenges of price differentials through the Uniform Pricing Mechanism (UPM) by ensuring the equaliation of transportation deficits of petroleum products.

Buhari had declined assent to an earlier version of the PIGB stating: “Expanding the scope of the Petroleum Equalisation Fund made some provisions of the draft law to be in divergence from his administrative policy and indeed conflicted with provisions of the fund.”

Currently, the equalisation levy on PMS inclusive of bridging, National Transportation Allowance (NTA) and Marine Transport Average (MTA) was 7.66 per cent.

But a five per cent fuel levy could be introduced for infrastructure financing.

Though it is also being feared that the absence of taxes on some white products such as AGO, DPK and LPG might enthrone a regime of unchecked exploitation by producers and operators.

In a related development, experts have advanced reasons for the persistence of oil theft in the Niger Delta amid efforts to check the menace that had cost the nation $55 billion in 10 years.

A gathering, comprising civil society organisations and the media in Warri, Delta State, linked the currency of the scourge to the involvement of big actors and highly placed individuals in the illicit business.

The Deputy Director (Programmes) of New Nigeria Foundation (NNF), Bunmi Olatunde, alleged that politicians, security forces, militants, oil workers, traders and members of the local communities were all profiting from the economic sabotage in additional to the lack of political will from the concerned authorities.