Some stakeholders in the oil and gas industry have commended President Bola Tinubu’s pronouncement on removal of fuel subsidy.
They made the commendations in separate interviews with the News Agency of Nigeria (NAN), in Lagos Monday after Tinubu’s inaugural speech as Nigeria’s President.
The National Operations Controller, Mike Osatuyi, independent Petroleum Marketers Association of Nigeria (IPMAN), said that the removal was a welcome development geared toward revamping the downstream sector of the oil and gas industry.
Osatuyi said that Tinubu had promised to remove fuel subsidies right from the first day of his campaign.
President Bola Tinubu, during his inaugural address, promised to end fuel subsidy, insisting that no budgetary allocation was made for it in the 2023 budget.
Tinubu promised to focus subsidy funds on infrastructural projects, education and healthcare.
According to Osatuyi, the pronunciation is part of his campaign promises.
He said that Tinubu during his campaign had said that from day one of his administration, he would remove fuel subsidy.
“The money used on subsidy will be diverted to develop other sectors.
“That means Tinubu has begun to fulfill his campaign promises,” he said.
The IPMAN boss said that the removal would bring about competition among players and also address the issue of monopoly.
Osatuyi said that the subsidy removal would lead to market liberalisation, availability of product and check excesses of middlemen.
He, however, said that there would be an increase in the price of petroleum but added that there would be competition.
Osatuyi noted that the money saved from subsidy removal would be used to boost the economy and the well-being of Nigerians.
“I commended his effort and lauded his courage for taking the bull by the horn.
Also, Managing Director, 11 Plc, Tunji Oyebanji, said that the pronouncement was a timely decision for the country.
Oyebanji, however, said it was not clear if the removal of fuel subsidy was with immediate effect.
“Scarce resources will be channelled to productive sectors of the economy.
“Borrowing levels will reduce significantly. It may possibly lead to the strengthening of the Naira,” he said.
Former Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN), Obafemi Olawore, who supported the subsidy removal, said there was need for the nation to move toward full deregulation.
“However, as a new administration, it must be done in phases; over six to 12 months to give room for consultation and engagement so as to make it bearable and less painful
An oil and gas consultant and a former Chairman, SPE Nigeria Council, .
Joe Nwakwue, said that President Tinubu was right when he said that petroleum subsidies are no longer sustainable.
Nwakwue said that considering the pain and social implications of removal, it would be irresponsible for any government to just yank it off without a plan.
“A multi-month plan that addresses key fuel market issues/challenges and measures to alleviate the pain needs to be crafted, adopted and rolled out.
“A knee jerk removal would be painful to the consuming public and potentially catastrophic to the economy,” he said.