IPMAN, PETROAN Reject Atiku’s Call To Restore Fuel Subsidy

Former Vice President Atiku Abubakar’s call for the return of fuel subsidy has been rejected by two major petroleum marketers’ groups, the Independent Petroleum Marketers Association of Nigeria (IPMAN) and the Petroleum Products Retail Outlets Association of Nigeria (PETROAN).

The groups argued that bringing back subsidy would not address the underlying problems in Nigeria’s petroleum sector, insisting that the government should instead concentrate on getting the country’s refineries and other critical infrastructure fully operational.

IPMAN spokesperson, Chinedu Ukadike, and PETROAN National President, Billy Gillis-Harry, stated their positions in separate interviews.

Naija News reports that their submissions followed renewed debate over the removal of petrol subsidy and Atiku’s call for the policy to be reinstated.

Ukadike said the priority should be the rehabilitation and proper operation of the Port Harcourt, Warri and Kaduna refineries.

According to him, having more refineries producing locally would increase competition in the downstream petroleum market and help stabilise petrol prices.

He also called for the revival of Nigeria’s pipelines and 21 petroleum depots, saying the sector needed functioning infrastructure rather than another subsidy regime.

“All these things are negative. The issue before this President is the restoration of all the refineries that are working in Nigeria. The restoration and revival of all the pipelines.

“The restoration and revival of the 21 depots in Nigeria,” Ukadike told Daily Post.

He argued that once local refining improves and competition increases, the pressure on petrol prices would reduce without the government having to spend heavily on subsidy.

“Whether we remove subsidy or not does not arise because competition will calm down the price volatility and reduce prices drastically.

“Not only will it drive competition, it will also reduce the dependency of exports on dollar exchange,” he said.

Ukadike also advised Atiku to focus on getting Nigeria’s refineries working rather than pushing for the return of subsidy.

“I also believe that Atiku Abubakar should also do some homework and understand that it is not bringing back subsidy that is our problem. Get the refinery to work again,” he added.

Gillis-Harry also rejected Atiku’s proposal, describing the former subsidy arrangement as a drain on resources that could have been used for national development.

He claimed that previous governments borrowed close to ₦2 trillion to fund subsidy instead of investing the money in infrastructure and human capital.

“The subsidy that we were operating under all the administrations was a stark loss of opportunity for the future of Nigeria,” he said.

Gillis-Harry defended President Bola Tinubu’s decision to remove the subsidy on May 29, 2023, arguing that the policy was no longer sustainable.

“So, we were borrowing nearly ₦2 trillion to pay subsidy, not to develop Nigeria, not to develop human capacity, not to do anything, prior to the President’s arrival on the 29th of May, 2023. And for a man who was ready for the job, he declared that subsidy was gone. And it is gone to today,” he said.

He also questioned the renewed calls for subsidy, noting that its removal was openly debated by presidential candidates during the 2023 election.

“Now, subsidy removal was a subject of discussion by all the presidential candidates. So, if there is a reason why any one of them is thinking to say subsidy will be brought in the back, it shows that they don’t love Nigeria. They don’t love Nigeria,” he said.

‘Where Will The Money Come From?’

Gillis-Harry further questioned the proposal to reduce petrol prices to ₦500 per litre, asking how the government would fund such a policy.

“Where is he going to get the money to reduce it to ₦500 per litre? So, he’s going to go back and go to China and get a loan of $1 billion,” he said.

He also challenged the idea of subsidising crude oil production, arguing that the cost of producing crude oil remains a genuine economic cost that cannot simply be wished away.

“How do you subsidise one barrel of production? Is the cost of producing one barrel of crude oil not real? It is real,” he said.

The PETROAN president also questioned Atiku’s record while serving as vice president, asking what was achieved during his eight years in office.

“So, what did he do at the time of his tenure as vice president? So, he didn’t do anything for eight years,” he said.

Gillis-Harry urged those pushing for a return to subsidy to present clear economic calculations showing the cost of crude oil production and explaining exactly what should be subsidised.

“What is the cost of producing one barrel of crude oil? And what is it that can be subsidised that will not be applied to subsidies?” he asked.

He maintained that the removal of subsidy had also forced Nigerians to become more careful with their finances.

“Nigerians are already not just adjusting, but disciplined. Financial discipline is sectioned among Nigerians, which is one of the most critical benefits. Social, moral benefits of the removal of subsidies,” he said.