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Fuel scarcity: The rich also cry

By Josef Omorotionmwan

NIGERIANS must count themselves lucky. The past year was one in which many ugly things were to happen in the land but God saw us through them all. For a good part of the year, our President was so ill that he was out of the country in search of superior treatment. Like the Biblical Paul and Silas, Nigerians prayed; they sang; and the Holy Ghost came down.

As if that was not enough, just the day after Christmas, Tuesday, December 26, 2017, the President’s son, Yusuf Buhari, was involved in a motorcycle accident around the Gwarimpa area of Abuja. Although the young Buhari was reported to have broken a limb and sustained injuries on the head, to the glory of God, he is alive and he is responding to treatment. We sincerely rejoice with the First Family; and earnestly pray that affliction shall not come a third time.

The world over, the dog of the President is also the president of dogs. Any member of the First Family is not an ordinary citizen. He must live above board. That’s why we must not fail to ask what the son of our own President, Yusuf, was doing on a bike? It is a taboo, which borders seriously on the failure of security. We demand an explanation on why the security details allowed him to go on a bike.


We can imagine that his counterparts elsewhere could be involved in plane and automobile crashes – not bike accidents! It is often said that an Englishman dresses for dinner, even in the jungle. Apparently, anyone who grew up in the colony of motorcycles might find it difficult to recognise that his status has changed. All the same, every nation deserves the leadership it gets; and the way we treat our leaders also goes a long way in determining the quality of life of the citizenry. From the smallest things, the greatest often grow. This underscores the need to investigate the Buhari accident.

Funny enough, Nigeria is one place where people must live with this open ambivalence: they have oil but they cannot see oil; they have petroleum but they cannot see petrol; and they pay for light, but end up getting darkness. If the full facts of the Buhari accident were known, it would be found that they may not be totally unconnected with the ongoing fuel scarcity ravaging the country. Why must we keep suffering for what we have in abundance?

Nigeria is said to be the sixth largest producer of oil in the world. But with mismanagement, what was originally supposed to be a blessing from God has virtually turned a curse. At every point, we are either fighting because of the poor allocation of this resource, or we are crying that some dubious elements have stolen the total proceeds. The original arrangement was that as soon as the crude oil came out from the ground, Nigeria would sell 90 per cent at the spot market in hard currency. The remaining 10 per cent was meant to be refined for local consumption.

At various times, Nigeria had built four refineries – two in Port-Harcourt and one each in Warri and Kaduna, intended to refine different products. These refineries were run aground; and they are now old and practically comatose. Because of our lack of refineries, foreign concerns that had refineries began to pick up, at rock-bottom prices, the 10 per cent crude reserved for local consumption. They would refine the products in their countries and export the refined products to us at their own prices. By the time the product returns to Nigeria after its triangular journey, the price has hit the ceiling and it is no longer within the reach of many. This is where government steps in to bring in what it calls subsidy.

Under this scheme, a country like the Netherlands, which does not have a single drop of oil, is in the Organisation of Petroleum Exporting Countries, OPEC, as a net exporter of oil. The subsidy regime in Nigeria reminds us of two issues – first, subsidy would have been absolutely unnecessary if we were doing our own refining in Nigeria. Secondly, the subsidy regime has been fraught with fraud and dishonesty.

Between 2006 and 2014, Nigeria paid over N7.5 trillion as subsidy claims. Yet, we are still where we are – the subsidised products are not available and where they are available, they sell for prices much higher than the unsubsidised products. Put differently, we have been subsidising fraud. The subsidy game has been a political one and has not been played on the rings of economic data; and rather than being fact-driven, it has been emotion-driven and politically played by those who use it as a political tool.

Subsidy in itself is not a bad idea. In fact, it is defined in Economics as money paid by government or an organisation to reduce the cost of producing goods so that their prices can be kept low. It seeks to reduce the market price of an item below the cost of production. Government intervenes to support desirable activities to keep the prices of staple low; maintain the income of producers of critical or strategic products; induce investment while reducing unemployment.

The ordinary Nigerian has always been at the receiving end of all the problems associated with fuel scarcity and the accompanying price increases. Successive administrations have put up the best arguments to support the desire for the removal of subsidy on petroleum products. We had no choice but to tag along. We have patiently watched the journey of the pump price of petrol go from six kobo per litre in 1973 to N245 barely a year ago. Today, what are we getting? The current scarcity is perhaps a gimmick for their attempt to shoot at N500 per litre.

Why, for goodness sake, should the refineries not work after the humongous amount we have put on turn around maintenance? And whatever happened to the modular refineries that held so much promise for us? Let something be done! The people are suffering! The rich also cry.

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