The World Bank has highlighted the possibility that the Federal Government is still shouldering fuel subsidies, as current fuel prices in Nigeria do not accurately reflect the associated costs.
Alex Sienaert, the World Bank’s Lead Economist for Nigeria, suggested that Nigerians should ideally be paying approximately N750 per litre, surpassing the current rate of N650 per litre. These remarks were made during the presentation of the Nigeria Development Update (NDU), December 2023 edition, in Abuja on Wednesday.
Sienaert remarked, “Petrol prices seem not to be fully adjusting to market conditions, indicating a potential partial return of the subsidy if we estimate the cost reflective of the retail PMS price, assuming official FX rate for importation.”
In the context of the government’s ongoing reforms under the renewed hope agenda, the World Bank emphasized the crucial need for transparency at the Nigerian National Petroleum Company (NNPC) Limited.
The bank called for openness to ensure accuracy in the oil revenues and earnings directed to the federation account. Additionally, the World Bank recommended that the government regularly disclose information explaining petrol pump pricing and stressed the importance of transparency at the NNPC concerning profits and the remittance of oil revenues to the Federation Account.
