A committee of the Nigeria Governors Forum has proposed a petrol price of between N380 and N408.5 per litre.
The committee is headed by Governor Nasir El-Rufai and has called for the instant removal of fuel subsidy.
While presenting the report of the committee, El-Rufai explained that the current subsidy regime was not sustainable owing to the fact that smugglers and illegal markets in neighbouring African countries were the beneficiaries.
He said Nigeria, like other Organisation of the Petroleum Exporting Countries member countries, agreed to a reduction in production in a bid to keep the prices high but Nigeria could not totally benefit from the regime because of subsidies.
He said: “Between N70bn and N210bn is estimated to be spent every month to keep gasoline price at N162 per litre. This is below the cost price and the remittance to the federation account will shrink to less than N50bn per month or even zero if threats persist.
“We are already at zero. I understand for tomorrow, so this scenario has occurred.
“Why are we keeping the price at N162? We are keeping the price because the Federal Government and trade unions met and agreed to the suspension of some industrial action months back.
“Even though we all supported deregulation of petroleum products prices last year, this agreement was suspended by the Federal Government because of a threat of industrial action by unions.
“This is the root of the problem and now we are back to losing between N70bn to N210bn per month.”
While explaining furrher, he said that in the 2021 budget. the Nigerian National Petroleum Corporation had committed to remitting at least N120bn per month to the federation account, but the body had been unable to do so.
He also explained that only around 12 states consumed two-thirds of the petrol that was heavily subsidised.
The committee recommended N408.5 litre as the appropriate price based on the situation on ground but that with concessions to labour unions, N380 per litre could be the minimum.
El-Rufai said: “The committee recommends PMS pump price increment from the current N162 per litre to N408.5 per litre (negotiations with organized labour unions). N380per litre (settlement with organized labour).”
He said this was necessary to free funds for important projects and fulfilment of other obligations.
