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The National President of the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN), Festus Osifo, on Friday, insisted that President Bola Tinubu-led government is still paying subsidy on petroleum.
Osifo, who is also the president of the Trade Union Congress (TUC), made this claim during an interview on Channels TV.
Recall that President Tinubu in his inauguration on May 29th declared that the subsidy era is gone, triggering a hike in the cost of the commodity across the nation.
Osifo, however, said due to the cost of crude oil in the international market and the dollar to naira rate, the government still pays subsidy for the product.
He said, “They [government] are paying subsidy today.
“In reality today, there is a subsidy because as of when the earlier price was determined, the price of crude in the international market was somewhere around $80 for a barrel. But today, it has moved to about $93/94 per barrel for Brent crude. So, because it has moved, then the price [of petroleum] also needed to move.
“The only reason the price will not move is when you are able to manage your exchange rate effectively and you are able to pump in supply and bring down the exchange rate.
“So, if the exchange rate comes down today, we will not be paying a subsidy. But with the exchange rate value and the price of crude oil in the international market, we have introduced subsidy.”
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