Worried by the present fuel price increase in the country, the Trade Union Congress (TUC) yesterday called on the federal government to subsidise crude oil for the Dangote Refinery to alleviate the disturbing fuel costs in the country.
The President of TUC, Festus Osifo who gave the charge during a press conference to address the pressing issues facing the country, in Abuja Thursday, attributed the recent increase in pump prices for Premium Motor Spirit (PMS) to the deregulation of the downstream petroleum sector, noting that while the government declared an end to fuel subsidies in May 2023, the subsequent fluctuations in the exchange rate have led to renewed subsidy-like conditions.
Osifo expressed worry that the current pump price is significantly higher than before the subsidy was lifted.
He said to ensure energy security in Nigeria, some conditions and demands must be met. He outlined three critical demands to include: improved accessibility, enhanced availability, and greater affordability of fuel.
The TUC president proposed a special intervention scheme to stabilise fuel prices by providing a favourable exchange rate for crude sold to Dangote.
He also called for all marketers to be granted access to products from Dangote Refinery, urging the government to clarify the refinery’s production capacity and expedite necessary approvals to increase output.
Osifo said “We must be able to buy this product. We want the price of the product to go even below where it was before. Not just where it was before. But, it will go below, if we attend clearly to the issues that are bordering on FX.
“Some of you may ask, why FX again? Government said they are selling crude to Dangote Refinery with our local currency, Naira. But you know, crude is an international product. So it is actually priced in USD.
“So what you now do is that you have to convert the value from the USD to the local currency. So the question is that, what is the exchange rate you are using to do that conversion? Is it a NAFEM exchange rate? Because something must be used to convert. So if that exchange rate today, as we know, is NAFEM exchange rate, that is bordering around 1,600 Naira plus.
“But government can intervene in that sector by what we have opined earlier. If that is done, in that case, you are not subsidising even consumption. You are subsidising production.
“That will even help Dangote Refinery to even employ more Nigerians and make its operations much more efficient. And that will crash the PMS price to where it was as of June last year,”.
The TUC boss stated the importance of consequential adjustments to wages, following a national agreement on the new minimum wage, while enjoining state governments to promptly implement these adjustments to help ease the financial burden on workers amid ongoing economic challenges.
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