Gasoline and the Nigerian Situation
May 14 2016 By Abiodun Giwa
Nigerians search to buy gasoline in their own country - a petroleum producing country (Courtesy: talkof naija.com)
The Nigerian Labor Congress has announced a nationwide strike for Wednesday, to protest government's arbitrary increase of the price of gasoline, from N86.00 to N145.00 liter.
The NLC has told the government to return the price of gasoline to N86.00, and says that if the government fails to heed its call by Tuesday, an industrial action will begin the following day.
The developing situation over the sudden increase of the price of gasoline arising from the termination of petroleum subsidy, which the government says it is necessary is still confusing.
Although, the NLC has rejected the price increase of gasoline, there are some petroleum employment associations that hail and the termination of the petroleum subsidy and the consequent increase in gasoline price..
News reports have shown that the decision of the President Muhammed Buhari led government to raise the price of gasoline twice its price per liter does not enjoy widespread acceptance among Nigerians, both at home and abroad. Many Nigerians view the government's decision as too harsh and capable of making living in the country that has already become difficult economically to forcibly push many people into the grave.
However, the government, through Vice President Osiyemi has told Nigerians that the decision to increase the price of gasoline is to ensure that the massive gain from the petroleum subsidy is taken away from fraudulent Nigerians and be used to make life more amenable for poor Nigerians. He admits that the government knows that the decision is very painful, but that it is a decision that is overdue to be taken in view of the fall in the prices of crude oil and the unexpected slump in the country's earnings.
The discussion among Nigerians and which the government says it is working to ameliorate is the suffering the government's decision will bring to poor Nigerians. Already, the economic situation in the country has almost fallen apart following the decline in government's income as a result of the the fall in the price of crude oil worldwide. There has been argument without resolution on what the government needs to do about country's currency exchange rate to the dollar. The government has officially fixed the Naira's exchange rate at N193 while the market forces has reduced the Naira to about 300 to the dollar in the open market.
The budget crisis and the resultant delay of the 2016 budget release was said to have caused a slow down in the economy. And now that the budget crisis had been resolved, the announcement of the withdrawal of the Petroleum subsidy and the consequent increase in the gasoline prices had been forced on Nigerians. Nigerians were shocked, waking up and heard the Minister of State in the Petroleum Ministry, Ibe Kachikwu's announcement of the withdrawal of Petroleum Subsidy and the consequent increase in the price of gasoline.
The government, through President Buhari, who is also the Petroleum Minister, had said it would stick to its decision to fix the exchange rate, rather than allow the market forces, in order to protect poor Nigerians from the effect of uncontrolled exchange rate.The music had been that the government was determined to do everything humanly possible to ensure unnecessary hardship was not visited on Nigerians. President Buhari specifically said so some months back against his decision for the withdrawal of the Petroleum Subsidy. And the same president had suddenly agreed on the withdrawal of the subsidy and also to the hundred percent increase of the price of gasoline, regardless of the government's knowledge of the suffering this will entail for ordinary Nigerians.
Many Nigerians that the Global Pentorch had interviewed said that life had already became palpable economically and that increasing the gasoline price from $86.00 to $145.00 is certain to exacerbate the economic situation. Many able-bodied working Nigerians are reported to be turning into beggars in their own country as a result of the dire economic situation in the country. One thousand Naira is said to be insufficient to buy pepper in the market for an average family's pot of soup. Now, they say with the gasoline increased price and the spiral effect on all areas of human lives and production costs and transportation, the price of pepper may be pulling toward a level an average family will be unable to afford.
Government has tried to explain the reason behind its decision to end the Petroleum subsidy and its knowledge of the effect on Nigerians, but many Nigerians are saying this is not the change that the government has promised and which they have voted for. Government apologists are saying they agree with the government that the country has to go through a painful process of rebirth for Nigerians to enjoy the fruit of government's promise. It was the same excuse many governments in the past, and one of them led by the present president, who had been a military president and minister of petroleum at different times, had given in the past, and for which Nigerians had expressed tiredness.
When the electricity supply recently dwindled beyond expectations, government traced the cause to the fall in the supply of gasoline and promised that it was working to resolve the problem. There was no debate about Petroleum subsidy or the need for its withdrawal in the country's Congress. The Congress was busy on the issue of the budget that was overloaded for pecuniary gains by government officials.
The announcement of the withdrawal of Petroleum subsidy and the increase in gasoline price has suddenly emerged in government explanation is part of its solution to restore gasoline sufficiency in the country and that difficulties in sourcing foreign exchange by petroleum marketers partly caused the gasoline scarcity amid government's inability to continue to provide foreign exchange for the marketers. Now, the government says anyone can import petroleum products into the country from anywhere with their own foreign exchange and sell at N145.00 liter.
Some analysts are saying that the gasoline may be going for between N250.00 and N300.00 liter and that the sad entertainment about gasoline and the Nigerian situation has just begun to be prolonged.
The NLC has told the government to return the price of gasoline to N86.00, and says that if the government fails to heed its call by Tuesday, an industrial action will begin the following day.
The developing situation over the sudden increase of the price of gasoline arising from the termination of petroleum subsidy, which the government says it is necessary is still confusing.
Although, the NLC has rejected the price increase of gasoline, there are some petroleum employment associations that hail and the termination of the petroleum subsidy and the consequent increase in gasoline price..
News reports have shown that the decision of the President Muhammed Buhari led government to raise the price of gasoline twice its price per liter does not enjoy widespread acceptance among Nigerians, both at home and abroad. Many Nigerians view the government's decision as too harsh and capable of making living in the country that has already become difficult economically to forcibly push many people into the grave.
However, the government, through Vice President Osiyemi has told Nigerians that the decision to increase the price of gasoline is to ensure that the massive gain from the petroleum subsidy is taken away from fraudulent Nigerians and be used to make life more amenable for poor Nigerians. He admits that the government knows that the decision is very painful, but that it is a decision that is overdue to be taken in view of the fall in the prices of crude oil and the unexpected slump in the country's earnings.
The discussion among Nigerians and which the government says it is working to ameliorate is the suffering the government's decision will bring to poor Nigerians. Already, the economic situation in the country has almost fallen apart following the decline in government's income as a result of the the fall in the price of crude oil worldwide. There has been argument without resolution on what the government needs to do about country's currency exchange rate to the dollar. The government has officially fixed the Naira's exchange rate at N193 while the market forces has reduced the Naira to about 300 to the dollar in the open market.
The budget crisis and the resultant delay of the 2016 budget release was said to have caused a slow down in the economy. And now that the budget crisis had been resolved, the announcement of the withdrawal of the Petroleum subsidy and the consequent increase in the gasoline prices had been forced on Nigerians. Nigerians were shocked, waking up and heard the Minister of State in the Petroleum Ministry, Ibe Kachikwu's announcement of the withdrawal of Petroleum Subsidy and the consequent increase in the price of gasoline.
The government, through President Buhari, who is also the Petroleum Minister, had said it would stick to its decision to fix the exchange rate, rather than allow the market forces, in order to protect poor Nigerians from the effect of uncontrolled exchange rate.The music had been that the government was determined to do everything humanly possible to ensure unnecessary hardship was not visited on Nigerians. President Buhari specifically said so some months back against his decision for the withdrawal of the Petroleum Subsidy. And the same president had suddenly agreed on the withdrawal of the subsidy and also to the hundred percent increase of the price of gasoline, regardless of the government's knowledge of the suffering this will entail for ordinary Nigerians.
Many Nigerians that the Global Pentorch had interviewed said that life had already became palpable economically and that increasing the gasoline price from $86.00 to $145.00 is certain to exacerbate the economic situation. Many able-bodied working Nigerians are reported to be turning into beggars in their own country as a result of the dire economic situation in the country. One thousand Naira is said to be insufficient to buy pepper in the market for an average family's pot of soup. Now, they say with the gasoline increased price and the spiral effect on all areas of human lives and production costs and transportation, the price of pepper may be pulling toward a level an average family will be unable to afford.
Government has tried to explain the reason behind its decision to end the Petroleum subsidy and its knowledge of the effect on Nigerians, but many Nigerians are saying this is not the change that the government has promised and which they have voted for. Government apologists are saying they agree with the government that the country has to go through a painful process of rebirth for Nigerians to enjoy the fruit of government's promise. It was the same excuse many governments in the past, and one of them led by the present president, who had been a military president and minister of petroleum at different times, had given in the past, and for which Nigerians had expressed tiredness.
When the electricity supply recently dwindled beyond expectations, government traced the cause to the fall in the supply of gasoline and promised that it was working to resolve the problem. There was no debate about Petroleum subsidy or the need for its withdrawal in the country's Congress. The Congress was busy on the issue of the budget that was overloaded for pecuniary gains by government officials.
The announcement of the withdrawal of Petroleum subsidy and the increase in gasoline price has suddenly emerged in government explanation is part of its solution to restore gasoline sufficiency in the country and that difficulties in sourcing foreign exchange by petroleum marketers partly caused the gasoline scarcity amid government's inability to continue to provide foreign exchange for the marketers. Now, the government says anyone can import petroleum products into the country from anywhere with their own foreign exchange and sell at N145.00 liter.
Some analysts are saying that the gasoline may be going for between N250.00 and N300.00 liter and that the sad entertainment about gasoline and the Nigerian situation has just begun to be prolonged.
