The Nigeria Governors Forum (NGF) has recommended the full deregulation of premium motor spirit (PMS), better known as petrol.
The governors made the recommendation at its 30th teleconference meeting held on Wednesday.
In a communique released after the meeting, NGF chairman, Kayode Fayemi, said the forum received presentation from Kafuna State Governor, Nasir El-Rufai, on the pricing of petrol.
El-Rufai’s presentation was based on the position of a six-man committee headed by him.
The committee was established earlier in the year by the National Economic Council (NEC) headed by Vice President Yemi Osinbanjo, to look into the dwindling revenues of states.
Other members of the committee include Godwin Obaseki, Kayode Fayemi, and David Umahi, governors of Edo, Ekiti and Ebonyi States respectively; as well as Godwin Emefiele, Governor of Central Bank of Nigeria (CBN); and Mele Kyari, Group Managing Director of Nigerian National Petroleum Corporation (NNPC).
In his presentation, El-Rufai “noted that between N70 billion and N210 billion is estimated to be spent every month to keep the PMS price at N162/litre.”
He said the situation is “completely unsustainable,” thereby backing the deregulation of petrol.
El-Rufai added that the increase in the price of petrol to N385 per litre would help reduce smuggling of petrol to neighbouring countries.
He said if petrol sells at N385 per litre, the Federation Accounts Allocations Committee (FAAC) would gain between N1.3 trillion and N2.3 trillion per annum.
The position of the governor is said to have been commended by some governors while others faulted the move saying it will impose more hardship on Nigerians.
In March, Kyari had revealed that the NNPC can no longer bear the burden of underpriced sales of petrol, adding that the market price need to be implemented.
But a day after making the remark, the corporation said it will maintain the current ex-depot price of petrol, until the end of negotiations with organised labour.