The Chairman, Major Oil Marketers Association of Nigeria, Mr. Adetunji Oyebanji has disclosed that the federal government spent a whopping N10.7trillion (Ten trillion and seven hundred billion Naira) on fuel subsidy in the last ten years.
Mr. Adetunji Oyebanji, who made the disclosure yesterday as a Guest Speaker at the 18th Aret Adams Lecture disclosed that in the year 2019 alone, the sum of N750billion (Seven hundred and fifty billion Naira) was spent on fuel subsidy.
He, therefore, canvassed for a total deregulation of the downstream sector, adding that total deregulation is more than just the removal of price subsidies, but deregulation requires the creation of a competitive market environment and will guarantee the supply of products at commercial and market prices.
“It requires unrestricted and profitable investments in infrastructure, earning reasonable returns to investors. It requires a strong regulator to enable transparency and fair competition among players and not to regulate prices.
He acknowledged that the federal government has taken some steps in this direction, but noted that “larger and faster leaps are now required”.
Oyebanji disclosed that Major Oil Marketers Association of Nigeria recently called for a national debate by stakeholders in the industry to share pragmatic and realistic initiatives to ease the impact of the subsidy removal on the society – especially on the most vulnerable.
Speaking further at the event, he postulated that “a shift from crude oil production to crude oil full value realization through deliberate investment in domestic refining and refined products distribution, creates the opportunity to transform the dynamics of the downstream sector from one of ‘net importer’ to one of ‘net exporter’, and thus spurring the growth of the Nigerian economy.
He stressed the need for a balance between ensuring the sustainable growth of the crude oil value chain (upstream through downstream) and providing value for the Nigerian consumer and the Nigerian economy, adding that effective reforms and regulations are key drivers for the growth within the refining sector.
He concluded by appealing to government to put the legislative and commercial framework in place and then let the market develop by itself.