Aliko Dangote, the founder of Dangote Petroleum Refinery, says this is the right time for the federal government to stop fuel subsidies. Dangote spoke during an interview with Bloomberg TV on Monday.
“I think it is the right time to (take away fuel subsidies) because all countries have gotten rid of subsidy,” he said, adding that subsidy is a sensitive issue, adding that once a country subsidises the product, people would increase the price. Dangote said it would lead to the government “paying what they are not supposed to be paying”.
We’ll track petrol sold locally
Dangote said the petrol sold locally by his refinery will be tracked to ensure the consumption rate is accounted for.
“But this refinery will bring quite a lot of issues out there. It would show the real consumption of Nigeria because nobody can tell. Some people say it is 60 million litres per day, some say it is less,” the billionaire said.
“But right now, by us producing, everything can be counted and accounted for. Most of the trucks or ships that will load from us, we will put a track on them to be sure they are going to take the oil within Nigeria and that can help the government to save a lot of money.
“For example, Saudi, citizens believe that oil is our god-given gift and should not charge us for it. The government was selling it at a very low price. But today, as we speak, gasoline is about 40 per cent cheaper in Nigeria than in Saudi Arabia, which I think does not make sense.”
‘Nigeria can’t afford subsidy’
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Dangote said petrol subsidy is not sustainable and the government cannot afford to keep subsidising.
“Our price of gasoline is about 60 per cent the price of our neighbouring countries and we have porous borders, so it is not sustainable. Government cannot afford the amount of subsidies we are paying,” he said.
Speaking further on the viability of petrol subsidy, Dangote said the government decides to either continue with or halt the payments.
“We have a choice of exporting when we produce and we sell locally. We are a private company and we indeed have to make a profit,” he said.
“We built something worth $20 billion, and we have to make money. The removal of subsidies is dependent on the government, not on us. We cannot change the price but I think the government would have to give up something for something.” Dangote said eventually, the subsidy would have to go.
On May 29, 2023, President Bola Tinubu said the petrol subsidy regime was over.
Almost three months later, TheCable reported that Tinubu was considering a “temporary subsidy” on petrol as crude oil prices and foreign exchange rates soared.
However, Ajuri Ngelale, former presidential spokesperson, said there was no reintroduction of subsidy.
Also, on January 3, the Nigerian National Petroleum Company (NNPC) Limited denied the return of the petrol subsidy, saying it had been removed entirely.
However, on April 15, Nasir el-Rufai, former governor of Kaduna state, said the federal government is spending more on petrol subsidies than before.
