Not a few stakeholders in the nation’s oil and gas industry have commended President Bola Tinubu’s pronouncement on the removal of fuel subsidy.
They made the commendations in Lagos on Monday after Tinubu’s inaugural speech as Nigeria’s President.
Mike Osatuyi, the National Operations Controller, Independent Petroleum Marketers Association of Nigeria, said that the removal was a welcome development geared towards revamping the downstream sector of the oil and gas industry.
Osatuyi reminded that Tinubu had right from the first day his campaign started, promised to remove fuel subsidy.
The President, during his inaugural address, promised to end fuel subsidy, insisting that no budgetary allocation was made in the 2023 budget.
Tinubu also promised to focus subsidy funds on infrastructural projects, education and healthcare.
Osatuyi noted further that, the pronouncement being part of his campaign promises ìs the first step towards Tinubu’s fulfilment of his campaign promises.
According to the IPMAN boss, “The money used on subsidy will be diverted to develop other sectors. “That means Tinubu has begun to fulfill his campaign promises,” he said.
Osatuyi observed that the removal would bring about competition among players and also address the issue of monopoly.
He stressed that the subsidy removal would equally lead to market liberalisation, availability of products and check excesses of middlemen.
However, he warned of a likely increase in the prices of petroleum products, but emphasised that it would engender healthy rivalry and competition.
He maintained that the money saved from subsidy removal would be used to boost the economy and the well-being of Nigerians. “I commend his effort and laud the courage for taking the bull by the horn,” he stated.
Similarly, Tunji Oyebanji, Managing Director, 11 Plc, said that the pronouncement was a timely decision for the country.
However, Oyebanji said it was not clear if the removal of fuel subsidy is with immediate effect.
He noted, “Scarce resources will be channelled to productive sectors of the economy. Borrowing levels will reduce significantly. It may possibly lead to the strengthening of the Naira,” he opined.
Obafemi Olawore, a former Executive Secretary of the Major Oil Marketers Association of Nigeria, said there is need for the nation to move toward full deregulation.
“However, as a new administration, it must be done in phases; over six to 12 months to give room for consultation and engagement so as to make it bearable and less painful,” he advised.
Joe Nwakwue, an oil and gas consultant and a former Chairman, SPE Nigerian Council, informed that President Tinubu was right when he said that petroleum subsidies are no longer sustainable.
Nwakwue said that considering the pain and social implications of removal, it would be irresponsible for any government to just yank it off without a plan.
“A multi-month plan that addresses key fuel market issues and challenges and measures to alleviate the pain need to be crafted, adopted and rolled out.
“A knee jerk removal would be painful to the consuming public and potentially catastrophic to the economy,” he said.
