The Minister of State for Petroleum, Dr. Ibe Kachikwu, appeared before the House of Representatives today to explain the reasons behind the current hike in pump price of petrol.
It was a special session by the lawmakers to quiz the minister on the development which may shut down the country by Wednesday if labour carried out its threat to embark on a total strike.
At the session, Kachikwu told the lawmakers that the Federal Government had no other option than to increase the price of fuel.
He said the action was taken because of the following:
- Diminished foreign exchange supply in Nigeria which forced marketers to stop importation and imposed over 90 per cent supply on the Nigerian National Petroleum Corporation (NNPC) since October 2015.
- Decline in government’s foreign exchange revenues.
- Renewed sabotage and pipeline vandalism in the Niger Delta.
- No provision for subsidy in the 2016 budget.
He said the fuel price of 86.50 gave an estimate subsidy claim of 13.7 Naira per litre, which translates to 16.4 billion Naira monthly.
He restated that they were left with no option than to liberalise the market.
According to Kachikwu, the new price band had gone into effect and that the market had stabilised in terms of product availability.
He said the NNPC would no longer resort to federation barrels and would endeavour to meet its obligation to pay FAAC 100 percent of its entitlement from the 445,000 barrels per day in the coming months.
Earlier, the House of Representatives plenary degenerated into a rowdy session, as lawmakers of the Peoples Democratic Party (PDP) refused to allow the Minister to be admitted into the chamber.
The PDP lawmakers waved the National flag, singing protest songs and were hell bent on not allowing the Minister entry into the Representatives’ chamber.
After several minutes, other lawmakers prevailed on the PDP lawmakers to allow the Minister in for questioning.