Fuel: FG not paying subsidy, Nigerians bearing burden of revenue loss from NNPC – Adeosun

The minister of Finance, Kemi Adeosun, has revealed that the federal
government is not paying subsidy to keep fuel price at N145, adding
that there is under recovery on the part of the Nigerian National
Petroleum Corporation (NNPC).

Adeosun disclosed this while speaking to State House correspondents
after the federal executive council meeting presided over by President
Muhammadu Buhari at the presidential Villa on Wednesday.

The minister said Nigerians have been bearing the burden of revenue
loss from the NNPC.

Adeosun said: "On the question of subsidy, the price of oil for
Nigeria today is a double edge sword. So every dollar that goes up we
get more revenue but also because we are importing refined petroleum
increases the landing cost of fuel.

"So for every time we get excited that the oil price is going up,
there is also a knock on effect on the price of imported PMS and that
is a function of us not having refining capacity, it is one of the
unfortunate impact of that.

"Now, when there is talk of payment of subsidy, technically today,
there is no subsidy but there is under recovery. Why that is, is
because NNPC are currently doing all the importing. They are importing
at a higher price than they are selling which means they are losing
money, which means effectively that loss is being borne by everybody
and effectively it reflected in the federation account.

"So, there is no subsidy payment in the way the old subsidy scheme use
to work where they were paying the oil marketers but there is an under
recovery, a loss on the importation of PMS being borne by NNPC and
therefore indirectly being borne by everyone one of us."