National President of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) Festus Osifo says the Federal Government is still paying subsidy on petroleum, in spite of President Bola Tinubu saying that subsidy era is gone.
Osifo, who is also the president of the Trade Union Congress (TUC) said the federal government is still paying subsidy for the product because of the cost of crude oil in the international market and the Dollar to Naira rate.
He said during an interview on Channels Television;
“They [government] are paying subsidy today. In reality today, there is subsidy because as of when the earlier price was determined, the price of crude in the international market was somewhere around $80 for a barrel. But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, then the price [of petroleum] also needed to move.”
On how the government can stop subsidising petroleum, Osifo said;
“The only reason the price will not move is when you are able to manage your exchange rate effectively and you are able to pump in supply and bring down the exchange rate.
“So, if the exchange rate comes down today, we will not be paying subsidy. But with the exchange rate value and the price of crude oil in the international market, we have introduced subsidy.”