Oyo State Governor and African People’s Movement presidential candidate, Seyi Makinde, says Nigeria’s debate on petrol subsidy is missing the point, and the country should instead focus on reviewing its petroleum pricing framework.
Makinde made this known in the September edition of his newsletter, _The Business of Governance_, released on Friday.
According to him, Nigerians deserve to understand what determines the price of petrol.
“We are asking the wrong question. The more important question is: what is the right pricing framework for an oil-producing country like Nigeria?” he said.
The governor said any proper framework must clearly spell out the crude oil price benchmark, refining costs and margins, exchange-rate assumptions, logistics and distribution costs, taxes, levies, and other variables that go into pump prices.
Makinde also rejected the idea that Nigerians should pay higher fuel prices just to stop smuggling to neighboring countries.
“We should also reject the argument that Nigerians must pay more for petroleum products simply to eliminate the price difference that makes smuggling into neighbouring countries profitable. Nigerians should not be made to bear the cost of government’s inability to secure its borders,” he stated.
He stressed that the discussion should move beyond whether subsidy should be restored or remain removed.
“The petroleum question should therefore not simply be whether subsidy should return or remain removed. It should be whether the pricing system we are using is the right one for Nigeria and whether it allows Nigerians to derive a fair benefit from the natural resources they own,” Makinde said.
The governor added that he will unveil an alternative petroleum pricing framework in the coming weeks for Nigerians to review.