Nigeria spent N43.31 billion on fuel subsidy in January alone
Although Nigeria has officially taken steps to fully deregulate the downstream sector, payment on fuel subsidy gulped about 100 billion naira in the first quarter of this year.
In its just-released Monthly Financial and Operations March 2020 report, Nigeria’s national oil firm, the Nigeria National Petroleum Corporation, NNPC disclosed the figure but described it as under-recovery.
It had consistently argued that only the National Assembly was empowered to approve fuel subsidy, despite the fact that NNPC’s monthly under-recoveries were due to subsidy on petrol.
According to the financials, the corporation spent N43.31 billion as subsidy on petrol in January this year.
In February, it incurred N20.68 billion as under-recovery, while in March the oil firm spent N37.66 billion as subsidy.
Petrol subsidy was, however, halted in March 2020 by the Petroleum Products Pricing Regulatory Agency following the crash in global crude oil prices.
The crash in crude oil price, according to the PPPRA, gave rise to the end of the petrol subsidy, as the agency stated that the petrol price would be adjusted in accordance with global oil prices.
The PPPRA has adjusted petrol price about three times since after the first adjustment in March this year.
The NNPC report further stated that the corporation paid N434.25 billion to the Federation Account Allocation Committee during the quarter under review.
It stated that in January, a total of N138.57 billion was remitted to FAAC, while the committee received N148.53 billion from the corporation in February 2020.
The NNPC said it paid N147.15 billion to FAAC in March this year.