Human rights lawyer and Senior Advocate of Nigeria, Femi Falana, has urged the Federal Government to reduce the price of petrol and direct the Nigerian National Petroleum Company Limited to refine the country’s 450,000 barrels of crude oil allocated for domestic consumption in local refineries.
Falana made the call in a statement issued by the Alliance on Surviving COVID-19 and Beyond (ASCAB) on Sunday, against the backdrop of rising international crude oil prices and the economic difficulties facing Nigerians.
He said the ongoing war between the United States and Iran had disrupted crude oil supplies through the Strait of Hormuz, pushing international crude oil prices above $100 per barrel and creating serious consequences for the global economy.
According to him, the inability of the United States to end the conflict means that the crisis could continue to disrupt major energy shipments and further threaten the global economy.
Falana said Professor Izielen Agbon, a United States-based petroleum expert, had, at an ASCAB seminar on the state of the nation, argued that Nigeria’s ruling class created the illusion of fuel subsidy through the manipulation of production methods and accounting statistics.
Agbon, according to Falana, said it made no economic sense for Nigerians to pay more for Premium Motor Spirit, popularly known as petrol, than consumers in Texas.
He also criticised the use of the Import Parity Price method, which, he said, assumed that crude oil was produced and refined overseas before the resulting petroleum products were imported into Nigeria.
Agbon urged the Federal Government to adopt the Production Cost Pricing method, based on the cost of producing crude oil, refining, transportation and distribution in the domestic market.
He said the approach would eliminate the need for fuel subsidy while making petroleum products more affordable and providing the energy needed for rapid industrialisation.
Specifically, Agbon said the cost of producing a barrel of crude oil in Nigeria ranged from $31 to $48, compared with the global average of $12.
He attributed the high cost to ageing infrastructure, insecurity, sabotage, oil theft and the high cost of imported oilfield inputs.
Agbon further estimated that, at an exchange rate of N1,333 to the dollar, the pump price of petrol should range between N435 and N687 per litre.
Falana also cited recent efforts by the Group of Seven nations to release 100 million barrels of diesel and crude oil from emergency reserves as part of measures to bring down energy prices.
He said several governments had previously introduced measures to cushion the effects of rising energy costs on their citizens.
“Even though Nigeria is a leading oil-producing nation, the nation’s four refineries have been run aground against the interests of the Nigerian people,” he said.
Falana also criticised the Nigerian National Petroleum Company Limited over its December 2024 announcement of the commencement of crude oil processing at the Port Harcourt and Warri refineries and the supply of petroleum products to the market.
He said that while efforts were being made to rehabilitate the country’s refineries, the Federal Government should reduce the price of petrol without further delay.
According to him, the 450,000 barrels per day benchmark was originally designated from Nigeria’s equity crude to supply the country’s four refineries and guarantee national energy security.
He therefore called on the Federal Government to direct the NNPCL to refine the 450,000 barrels per day in local refineries and sell the resulting petroleum products to Nigerians at affordable prices.
SOURCE: thegavel.com.ng
