There could possibly be an additional enhance within the retail pump worth of petroleum merchandise like petrol, kerosene and diesel.
That is as a result of Federal Authorities’s proposal of the addition of the price of managing the nationwide strategic shares of petroleum merchandise to the retail worth of the commodities.
In keeping with a report from Vanguard, this proposal is contained within the 2020 Petroleum Trade Invoice (PIB) which is at present earlier than the Nationwide Meeting for passage.
Which means that the passage and subsequent signing into regulation of the PIB, will result in additional enhance within the pump worth of petrol. Different issues being equal, as the price of managing the nationwide strategic gas shares would, from then, type an integral part of the pricing template of petroleum merchandise and would decide the pump worth of the commodities.
Different present elements of the pricing template, other than the touchdown price embody the Nationwide Transportation Common (NTA), the Nigeria Ports Authority (NPA) fees, entrepreneurs margin and transportation prices.
Within the new PIB that’s earlier than the Nationwide Meeting, the brand new Nigerian Midstream and Downstream Petroleum Regulatory Authority that might emerge from the scrapping of the Petroleum Merchandise Pricing Regulatory Company (PPPRA) and the Petroleum Equalization Fund (PEF), is to be saddled with the duty of organising and managing the nationwide strategic shares of petroleum merchandise.
The brand new company would decide the quantity to be charged as a levy for financing the strategic petroleum merchandise’ reserves. Which might type a part of the retail worth of every of the petroleum merchandise, and in addition mandate to work with safety companies in deciding areas of the nation the place the nationwide strategic shares can be maintained and distributed. The 2020 PIB partly reads;
- “The Authority shall: set up, administer and make sure the storage and distribution of the nationwide strategic shares of petroleum merchandise in accordance with laws issued by the Authority.
- Decide and publish the quantity to be charged as a levy for the financing of the nationwide strategic inventory, which shall type a part of the retail worth of every petroleum product, such levy to be decided as a share of the retail worth and be deducted on a wholesale foundation; and
- Designate, in session with the suitable authorities and nationwide safety companies, the strategic areas throughout the nation the place the nationwide strategic shares shall be distributed and maintained.”
The PIB can be proposing that amenities and infrastructure that are to be particularly outlined by the soon-to-be-established Nigerian Midstream and Downstream Petroleum Regulatory Authority for the storage of nationwide strategic shares can be exempted from the provisions of the regulation regarding open entry.
The opposite features of the Nigerian Midstream and Downstream Petroleum Regulatory Authority within the new PIB embody; regulating and monitoring technical and business midstream and downstream petroleum operations in Nigeria, and figuring out applicable tariff methodology for processing of pure gasoline, transportation and transmission of pure gasoline, transportation of crude oil, and bulk storage of crude oil and pure gasoline.
What this implies:
That is going so as to add extra monetary burden to Nigerians who’re already complaining of the excessive price of petroleum merchandise, which has negatively impacted on the worth of products and providers.
It may be recalled that the Federal Authorities had a while in the past proposed a brand new cost on petroleum merchandise for highway upkeep throughout the nation. This was roundly condemned by Nigerians and a few stakeholders earlier than the concept was later suspended.