Nigeria, as at yesterday, is currently saving N647.2 million daily from the suspension of subsidy on Premium Motor Spirit, also known as petrol. Particularly, at the current price of N86.50 per litre in petrol stations across the country, the country is making an extra N16.18 per litre.

The Federal Government had stated that this extra savings is kept in an escrow account to serve as a cushion in case of eventuality, such as if the price of crude oil rebounds, leading to an increase in the selling price of PMS. The saving is partly due to the continuous decline in the price of crude oil in the international market, which dragged the open market price of petrol to N70.32 per litre. The amount the country is saving is based on a 40 million litres average daily consumption of PMS by Nigerians as declared by the Federal Government. Since the announcement and commencement of the price modulation regime by the Federal Government, the open market of PMS had fluctuated between N4 and N12 per litre before rising to its current level. Data obtained, yesterday, from the Petroleum Products Pricing Regulatory Agency, PPPRA, in its pricing template for PMS for February 9, 2016, revealed that at a retail price of N86.50 per litre as approved by the Federal Government, the country is saving N16.18 per litre of the product. The PPPRA put the landing cost of the product at N56.02 per litre, composed of Cost plus Freight — N51.19 per litre; Lightering Expenses — N2.02; NPA Financing — N0.15, Jetty Throughput Charge — N0.60 and Storage Charge — N2.00 per litre.

Credit: Vanguard