It's price modulation, not subsidy removal - Petroleum Minister

The Federal Government plans to focus on price modulation of petroleum products to ensure efficiency and availability of the products.

Minister of State for Petroleum, Dr. Ibe Kachikwu who disclosed this to newsmen in Abuja on Thursday said that price modulation has nothing to do with fuel subsidy.

“There is too much emotion around subsidy issue, but our focus is that the Federal Government should not spend as much as it spends every year on subsidy.

“First, it is an issue of irresponsibility; this year we have spent about one trillion and given the state of the finances, we have to save money from every means.

“What I am trying to do is to make sure that whatever we do, the poor people will not be affected. So whatever we are going to do will be intellectual,’’ he said.

“It is not that we have removed subsidy but the application of market forces will enable you to sell products as close to the prices we have today.

“Is it going to be between N87 and N90; we will have to get PPPRA to do those templates and at 35 million (litres) we may sell products at N87; by the time we consume 36, we may be selling at N90 or N91.’’

Stressing that prices would no longer be fixed, the Minister pointed out that the price of crude oil will henceforth determine the prices of petroleum products.

“ Today the prices are largely close to N87; there might be no need to change the price by January, and it might go up or come down slightly by April.

“It is all the dynamics of what the crude is; so, I have not put a static figure. Myself and PPPRA will sit down and do the calculations and be able to announce what price PMS will sell in January,’’ he said .