The African Democratic Congress (ADC) says former Vice-President Atiku Abubakar’s proposal to reduce petrol price to about N600 per litre is not a return to the abolished fuel subsidy regime.
The ADC National Publicity Secretary, Bolaji Abdullahi, said this in a statement reacting to the Presidency’s criticism of the proposal.
Abdullahi said the proposal was a controlled production incentive for domestic refineries aimed at reducing petrol prices and strengthening local refining capacity.
He said the Presidency’s argument that the proposal could cost N19.1 trillion failed to take into account its structure and potential economic benefits.
“The Presidency has based its argument on a projected N19.1 trillion cost without properly considering how Atiku’s proposal is structured or the wider economic benefits of cheaper fuel produced locally.
“We are at a loss as to how the Presidency conjured up this phantom figure. But we do not agree with it,” he said.
According to him, the proposal would have a fiscal limit and mechanisms to monitor the movement of crude from refinery intake to finished petroleum products.
He said the ADC was proposing a controlled incentive scheme different from the previous subsidy regime, which, according to him, would help reduce fuel prices and encourage domestic refining.
Abdullahi also questioned the government’s decision to provide incentives to oil producers while rejecting measures aimed at reducing the burden of high fuel prices on Nigerians.
He cited offshore oil production incentives of up to 11.50 dollars per barrel and questioned why a similar controlled incentive for domestic refineries should be rejected.
“If Nigeria can provide a production-linked fiscal incentive of up to 11.50 dollars per barrel to stimulate offshore oil production, why is a carefully controlled crude-input incentive for domestic refineries dismissed as economic madness when its objective is to make fuel cheaper for Nigerians and build domestic refining capacity?” he asked.
The spokesman said high petrol prices had contributed to increased transportation costs, food prices, production expenses and the wider cost-of-living crisis.
He maintained that the proposed incentive would be capped, audited and traceable, while helping to reduce petroleum imports, conserve foreign exchange and strengthen domestic refining capacity.
