Harry Archie
The Federal Government has said the petrol discount introduced by NNPC Retail Limited is not a return of fuel subsidy, insisting that no public money is being used to reduce prices.
Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, explained this in a statement issued in Abuja on Friday.
He said NNPC Retail was reducing its profit margin on petrol to offer customers lower prices, rather than receiving money from the government.
According to Oyedele, a subsidy occurs when the government uses public funds to pay part of the cost of fuel.
He said the Tinubu administration ended that system in 2023 and had no plan to bring it back.
He explained that NNPC Retail buys petrol from the Dangote Refinery and other suppliers at market prices but temporarily reduces its profit margin to make fuel cheaper for consumers.
Oyedele added that the discount could benefit both customers and the government because lower prices might attract more buyers and increase the company’s overall sales.
He also dismissed concerns that the discount would encourage petrol smuggling into neighbouring countries, saying the retail profit margin accounts for less than five per cent of the pump price.
The minister said other government measures to reduce fuel-related costs include expanding the use of compressed natural gas (CNG) for transportation, removing taxes and duties on petrol, and eliminating illegal charges that increase transport costs.
He maintained that the measures were designed to ease the burden on Nigerians without bringing back the fuel subsidy system.
