Makinde rejects higher petrol prices to curb smuggling

African People’s Movement presidential candidate and Oyo State Governor, Seyi Makinde, has said Nigeria’s ongoing debate over petrol subsidy is centred on the wrong question, arguing that the country should instead review the framework used to determine petroleum prices. Makinde made the position known in the September edition of his newsletter, The Business of Governance, uploaded on Friday. He said Nigerians should be able to understand the factors behind the price of petrol, including the crude oil price benchmark, refining costs and margins, exchange-rate assumptions, logistics and distribution expenses, taxes and levies, as well as other variables used in determining pump prices. According to the governor, the key issue should be identifying a pricing system that is appropriate for an oil-producing country like Nigeria, rather than simply debating whether the petrol subsidy should be restored or remain removed.

Makinde also opposed the argument that Nigerians should pay more for petrol to discourage the smuggling of petroleum products into neighbouring countries. He said Nigerians should not be made to bear the cost of the government’s inability to secure the country’s borders, arguing that the focus should instead be on whether the existing pricing system allows citizens to benefit fairly from the nation’s natural resources. The governor said the petroleum debate should therefore move beyond the question of subsidy and focus on whether Nigeria’s pricing framework is suitable and transparent enough for an oil-producing country. He added that he would present an alternative petroleum pricing framework in the coming weeks for Nigerians to examine and assess.

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