Crude oil rises to $64.17 as fuel subsidy hits N43/litre

The rise in crude oil price has spiked the Expected Open Market Price of Premium Motor Spirit (PMS), popularly known as petrol, leading to a sharp increase in the amount spent on subsidy.

Data obtained in Abuja on Tuesday showed that Brent, the commodity for which Nigeria’s crude was priced, appreciated by $0.54 to $64.17 per barrel.

Crude in the Organisation of Petroleum Exporting Countries (OPEC) basket increased in price by $1.46 to $63.68 per barrel.

This came as findings from the Petroleum Products Pricing Regulatory Agency on Tuesday showed that the Expected Open Market Prices of petrol also increased, a development which operators attributed to the marginal rise in global crude oil price.

The increase in EOMP led to an increase in the amount spent on subsidy by the Nigerian National Petroleum Corporation, the country’s sole importer of PMS currently.

Tuesday’s data from the PPPRA on the agency’s pricing templates for November 21 and November 25, 2019, put the EOMP of petrol at N178.92 per litre and N172.81 per litre, respectivly.

The ex-depot price for collection of PMS remained the same at N133.28 per litre, being the price that the corporation sold the commodity to marketers, who then dispensed to consumers in filling stations at the N145 per litre approved rate.

An analysis of the EOMP and ex-depot prices showed that on November 21, the NNPC incurred about N45.64 as subsidy on every litre of petrol. It subsidised the commodity by about N39.53 per litre on November 25.

This implies that on average, the corporation spent about N43 as subsidy on every litre of petrol consumed in Nigeria within the five-day period.

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