The Nigerian National Petroleum Corporation (NNPC) has revealed that subsidizing Premium Motor Spirit, PMS also known as petrol gulped a whopping N101.65bn in the first three months of the year.
This was contained in the corporation’s Monthly Financial and Operations March 2020 report.
The National Oil Corporation, NOC described the subsidy spending as under-recovery. This means that Nigeria is incurring an additional cost in subsidizing the price of petrol to make sure it falls within the regulated price of N143.80 per liter, even though the real market price is above this regulated rate.
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Giving a breakdown, the report stated that the corporation spent N43.31bn as subsidy on petrol in January 2020, in February, it incurred N20.68bn as under-recovery and N37.66 billion in March as subsidy.
However, the subsidy was halted in March 2020 by the Petroleum Products Pricing Regulatory Agency, PPPRA after the crash in global crude oil prices.
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The development, according to the PPPRA, led to the end of the petrol subsidy, as the agency stated that the petrol price would be adjusted following global oil prices.
The PPPRA has adjusted the petrol price about three times since the first adjustment in March this year.
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In another development, the corporation also revealed that the sum of N434.25 billion was paid into the Federation Account Allocation Committee, FAAC in the first quarter of 2020.
It stated that in January, a total of N138.57bn was remitted to FAAC, while the committee received N148.53bn from the corporation in February 2020 while the sum of N147.15bn was paid to FAAC in March 2020.
