The stability of petrol pump prices in Nigeria amidst the rise in oil prices and the naira’s continuous fall in the forex market support reports that the federal government is back paying subsidies for Premium Motor Spirit (PMS).

Brent Crude price stood at $94.20 per barrel while WTI Crude and Bonny Light sold for $91.26 and $97.17 respectively on Wednesday. The price surge has yielded an excess gain of about $20 above Nigeria’s $75 2023 oil benchmark – a development expected to have shot up the price of petrol above N800 per liter in Nigeria.

Also, the naira’s depreciation in the exchange market has seen the dollar rising by 2.93%, selling at N983/$1 as of Wednesday afternoon.

Oil marketers last month when the naira was trading at N945/$1, warned that petrol prices would hit N680 per liter and N720 per liter as the dollar rises.

“Once there is a slack in the naira against the dollar, there is going to be an effect. The demand and supply of forex is a key factor. We should also understand that it is not only petroleum products that use forex,” the National Public Relations Officer, Independent Petroleum Marketers Association of Nigeria, Chief Chinedu Ukadike, was quoted by The Punch as saying.

“Other manufacturers who import one thing or the other are also searching for dollars. So, the surge for dollars has continued to increase. So now that the dollar is hitting N910 to N940, and approaching N1,000, you should expect to buy PMS at the rate of N750/liter.

“It is simple mathematics, once the dollar is going up, have it in mind that the prices of petroleum products would definitely increase because the products are dollar-driven,” he added.

The stability of petrol pump prices amid the surge in oil prices and the decline of the naira has been fingered as credence that the government is silently paying subsidies through the Nigerian National Petroleum Company Limited (NNPC).

In August, the NNPC issued a statement, allaying fears that the price of petrol was about to rise further to N720 per liter, following a threat by the Nigerian Labour Congress (NLC) to embark on a nationwide strike. The company said it has no plan to increase PMS pump prices as widely speculated, urging Nigerians to “buy the best quality products at the most affordable prices at NNPC Retail Stations nationwide.”

Against this backdrop, experts believe that there is more to the fuel subsidy removal than meets the eye, even though the federal government has maintained that the subsidy has been totally removed and that it does not plan to reintroduce it.

“The PMS subsidy was removed. Thus NNPC sold at total market prices, that’s why FAAC got almost a trillion naira. Then President BAT [Bola Ahmed Tinubu] promised “no new price hikes”, thus subsidy payments were reintroduced to keep local prices stable, economist, Kalu Aja said. “Stay factual. The problem with all these is that there is no FGN or Federation document removing, replacing, or even amending PMS subsidy; all we have as official documentation is the NNPC Pricing memo.”

The reinstatement of the fuel subsidy was confirmed by a report of the Federal Account Allocation Committee (FAAC), which stated that the NNPC used $220m out of the $275m it received as dividends payable to Nigeria, to pay petrol subsidy. The report added that the NNPC held back $55m for unexplained reasons.

Earlier this month, The Guardian reported that a significant monthly loss of about N318 billion (approximately N10.6 billion daily) is currently being incurred on petrol, and this may be categorized as under-recovery by NNPC Limited. This situation mirrors a previous scenario that occurred during the former administration of Muhammadu Buhari, where the government covertly reinstated fuel subsidies and labeled them as under-recovery in the books of the NNPC.

Some analysts believe that considering Nigeria’s current economic situation, Nigerians cannot afford to buy petrol at international rates. Thus, they have called for targeted subsidy.

“Sadly I concede that PMS subsidy is here to stay. The Nigerian people will not accept pain at the fuel pumps if the politicians do not share that pain with them. Unless oil prices recede, 100% PMS removal is a dream.

“My position had been that not all Nigerians should pay full price for energy, the subsidy must be targeted at the poor and vulnerable and the strategic job-creating sectors in Nigeria e.g. textiles and agriculture,” Aja said, adding that no one will argue if farmers are subsidized with cheap fuel if that leads to cheaper food.

Things happen but you would not have expected that Huawei could come back within years, to be put in the same bucket as Apple, considering that it was on ground zero about two years ago. Yes, Huawei Mate 60 Pro is now seen as a generation leading smartphone for some remarkable breakthroughs it has inside it: “Huawei’s chip breakthrough poses new threat to Apple in China”, CNBC wrote.

Across the industry, the question is this: how did Huawei execute this? Some may explain the success away, arguing that Huawei bypassed Western sanctions, while others will posit that Huawei had inherent capabilities which morphed under sanctions, to ascend to its evolving greatness.

In the Igbo Nation, we say that  “mberede ka eji ama dike”  which loosely translates to “you know who a brave person is when the person is confronted with unforeseen problems, and that person is able to tackle them”.  Huawei did not achieve anything that even Africans could not achieve. What is remarkable here is simple: even during peacetime, the government of China, and Huawei in particular, are able to rise to overcome their challenges.

During the Biafran war, all the technical professors in University of Nigeria Nsukka became legends. They designed bombs, grenades, rockets, etc. In short, they designed a refinery to refine crude oil. 

Prof Gordian Ezekwe led the Rocket Group under Biafran Research and Production Directorate (that was Lockheed Martin, Boeing, etc in one). The accomplishment is uncommon as they not only designed the systems, they designed production systems, and manufactured the stuff, while under sanctions and blockade, which made it impossible to even import salt. Prof Njoku Obi while under the sanctions invented a vaccine which the WHO approved for the treatment of cholera. That vaccine was later used during the Kano 1970s cholera outbreak.

Why this deviation? I just want to tell everyone in Nigeria and Africa that we have these inherent capabilities. The Biafran war showed that we have everything. The real challenge is how we can innovate and lead during peacetime the ingenuity and unbelievable brilliance demonstrated during the war. For China and Huawei, they do not need wars to break the periwinkle to get the gems of cryolite, and that is the Huawei Miracle.

:”A new smartphone from Huawei Technologies could threaten Apple’s dominance in China, CNBC reports. The phone, called the Mate 60 Pro, has a semiconductor chip that’s apparently 5G capable — which, if true, represents either a breakthrough achievement or a violation of U.S. trade restrictions. The U.S. cut off the Chinese tech giant’s access to 5G chipmaking technologies in 2019, prompting questions about how Huawei was able to make a 5G chip and whether it can scale production of the Mate 60 Pro enough to turn a profit. The stakes could be significant, since Apple’s market share in China is about 20%. ”

• Huawei’s latest smartphone, the Mate 60 Pro, has a chip that appears to support 5G.
• This despite U.S. sanctions that have sought to cut the Chinese tech giant off from the technology.
• The chip, made by China’s SMIC, has sparked concern in Washington and raised questions about how it was possible.
• A resurgent Huawei could pose a challenge to Apple in China, one of the U.S. company’s biggest markets.

Permit me to borrow your beautiful adage ‘Mberede ka eji ama Dike’ translation ‘you know who a brave person is when the person is confronted with unforeseen problems, and that person is able to tackle them’.

Suffice to say, that necessity is the mother of invention. This is…

— Chukwunedum Ekwenibe (@MiriEnweIlo) September 20, 2023

Comment on Feed

Comment 1: People who built airstrip, bombs and a refinery in wartime obviously can do much more in peacetime. But Nigeria is not a real place, here the politics is more important than development, so what you see are people who are incapable of doing anything grandstanding that they must be in charge, thereby keeping everyone on the ground.

If you have a medical issue, you go see a doctor, and if you want to build, you go see an engineer. But in Nigeria, when it comes to governance and development, you bring those who never excelled in anything humans admire and revere. And somehow the delusion continues that we will get it right, no, you are never going to get it right, because what will make it right is right there staring at you.

We know how to cite other people’s cases and their commitment to excellence, but magically become numb and hysterical when asked to demonstrate same on homefront.

Dishonest people are never going to advance, and Nigeria is filled with dishonest and unscrupulous creatures.

It is a big irony: everyone wants to leave Nigeria. But quickly you leave Nigeria, you would realize that everything you are looking for is ACTUALLY in Nigeria. Check all Nigerians in America, more than 99% are looking for opportunities in Nigeria! Yes, everyone is trying to invest, build or do something because the conclusion is clear: America will pay the bills but Nigeria could make you rich.

For me, I have been working to keep my Nigerian accent intact, as it offers me competitive advantages to connect in the Nigerian market. Lol. Why miss the market?  We all want to wake up with Nigeria on our minds because everything there is opportunity.

So, as you japa, do not lose your bearing and contacts. Many things are amazing in Nigeria on how we structure our companies and promotions. There, everyone at the same level earns the same thing. But in the US, you can earn more than your supervisor. Yes, democracy does not reach compensation! It is legendary.

Do you doubt it? Check your friends in US big banks, bigtech, big universities, etc, everyone is looking for what idea to monetize in Nigeria.  

The greatest among us are actually those who are still holding the nation in Nigeria, and broad Africa. You can preach whatever you want to preach, the fact remains that most diasporans get their juices and fatter wallets because of the homeland opportunities. About 99% of African startups in the US are where they are because of the integrations to the native lands. Those are great things and should be celebrated.

Reverse remote japa is real! That is fueling all these big startups! 

One thing remains for Nigeria to rise: consistency in how we see evil and good. When the insignia of “Tinubu Presidential Legal Team (TPLT)” was found in the document uploaded by the presidential election tribunal, I read how some eminent lawyers explained the implications away. Had that been Buhari, those lawyers would have gone to court for answers. And as you read the tribunal outcomes across state levels, you see no consistency: a tribunal takes one out on certificates, but in another, it is not an issue. Simply, no core.

Comment on Feed

Comment 1: Many commenting didn’t completely what Prof said or didn’t probably quite get it. Prof isn’t advocating for Nigerians in Diaspora to “Japa” back to Nigeria but to reverse their interest. Stay in US, UK, Dubai, Canada, Australia etc and repatriate $ as FDI in worthy investments in Nigeria in partnership with a credible Nigerian at home and many money passively while still being in the Diaspora.

I am in a group with Nigerians in Diaspora are making real money investing in back in Nigeria.

That’s “reverse remote japa”!

Comment 2: I know that many who arrive in Canada struggle to adjust for many reasons. The biggest reasons being the high cost of living, the cold weather, and despite what they have heard, or have been lead to believe, the lack of opportunities.

The costs are brutal in Canada. From housing to products to services, everything is inflated well above what they should be. Everything here is more expensive than in the U.S for example.

The Canadian climate is cold, especially in our winters. It is not unusual to have four solid months well below zero degrees Celsius and at least two to four weeks at minus twenty-five for example. Unless you’re in Yellowknife where the high in winter will be minus twenty-five for three months.

Almost all jobs in Canada require Canadian experience. But how do you gain experience without the experience – It’s ludicrous.

So before japaing to Canada do your homework. Canada’s university that accepts the most international students is the University of Alberta – but that is in Edmonton which is a cold place so be prepared for long cold drab consecutive months of winter with at least a meter of snow.

Cheers all, and try to have a wonderful week ahead.

Comment 3: Yes, Prof. Nigerians abroad are looking for opportunities to invest in Nigeria, but they are also reluctant due to currency depreciation, political instability, insecurity, and lack of trustworthy partners in Nigeria. I know of a family friend that was killed in Nigeria after he invested and moved to Nigeria to retire. This happened less than a year ago. The story was in the news.

The $1000 that was invested 2 years ago now worths less than $500. Some Nigerians are also shortsighted. They’d rather steal money than see how the investment creates long-term job security for them. There’s no system to hold those that steal from businesses accountable in Nigeria.
I love Nigeria, but I’ve seen too many horror stories.