COVID-19 vaccine discovery is reason for petrol price hike, says FG

Minister of State for Petroleum, Timipre Sylva on Monday said that the increase in the price of petrol was as a result of the announcement of a vaccine for COVID-19 by pharmaceutical company, Prizer.

According to him, the announcement made the price of crude oil to go up and therefore affected the price of petrol.

Speaking to State House correspondents after meeting President Muhammadu Buhari at the Presidential Villa, Sylva said, “now what happened recently was because of the announcement of a vaccine for COVID-19 by Pfizer.

With that crude oil prices went up a little bit. If you have been following crude oil prices you would have seen that crude oil prices went up a little bit, as a result of this announcement”, he explained.

“So when crude oil prices go up a little bit, then you will see that it instantly reflects in the price of petrol, which is a derivative of crude oil.

That’s why you see that there’s this movement and if we listen to ourselves, this is the same explanation we’ve been giving.

“Like when the pump prices came down, we reduced the pump price because it reflected, we saw that crude prices were lower, so we reduced the pump price when we deregulated.

Then when the crude prices went up, it went up, when it comes down, it goes down.

That is how it works” So that is why you will be seeing this, go up and down in the market place.

Now we have introduced the alternative fuel , which is gas because we feel that it is important for Nigerians to have another option, which will be cheaper”, he stated.

While speaking on the deregulation in the petroleum sector, Sylva said, “ let us first agree that these are not the best of times not only for Nigeria but for the global community.

What we have said over and over again as a government is that government is no longer in the business of fixing pump price, that is the meaning of deregulation and stepping back on subsidy.

“Yes, we are very aware that this will result to some increase but why do we have to do this , because it is clearly impossible for government to continue to subsidize. The money is not there now.

Just take the example of our production levels , our crude oil production level was over 2 million barrels a day , today to comply with OPEC cut and quota, we have reduced production to 1.4 million barrel .

“Having reduced production to 1.4 million barrels ,crude oil is also not selling at an optimal rate .Where do you get the money to continue to subsidize.

I was just discussing with someone today that we just have to make a choice , if government were to continue with subsidy, it means for example that at some point we may not even have money after subsidizing petrol to pay salaries.

“You have to choice .it is very clear that today things are not as they were before . The earnings of government has reduced by 60 percent and what is happening in the oil sector reflect what is happening elsewhere.

Our FIRS collection has also reduced because less oil is being produced , there is less activity in the oil industry which is driving the economy, he added.

Sylva further said, “I am telling you if Mr President could have continued with subsidy he would have .

But when you look at the facts before us, it is not possible and of course we are seeing some of the effects but I belive that at this point we are still trying to cross the first buck , we will get there , we will get used to it as Nigerians.

“Look at it a situation where diesel has been deregulated long ago , a situation where kerosine has been deregulated long ago, and this are the fuels the poorest and lowest people in Nigeria interacted with more.

Why do I say that , if you want to transport food from the north to the south , it will be by trucks that are run by diesels not with petrol.

“Those trucks that transport food from the north to the south are usually run by diesel.

Kerosene is the preferred fuel at the lowest level of our society, these have been deregulated long ago, so what is the problem with deregulating petrol which is mostly used by the elites.

“Let us be fair to this country , let us be fair to the poor people of the country.

If we have deregulated what they were using, then there is absolutely no reason to subsidize petrol. I feel so.

The only explanation to everything we have said is the country just could not afford subsidy anymore.

it is unfortunate we are experiencing some of these things now.

We will get by, I am sure when things stabilize our earnings begin to improve, we will begin to see the benefits of what this government has done”, he noted.