A publication by the Major Oil Marketers Association of Nigeria on Tuesday showed that Nigeria had been subsidising petrol for neighbouring nations for many years.
In the publication, which was signed by the MOMAN Chairman, Adetunji Oyebanji, and sighted by The Punch correspondent in Abuja, the oil marketers stated that the continued payment of subsidy on petrol was not sustainable.
The absence of subsidies in neigbouring countries has created the incentive to smuggle about 30 per cent of petrol meant for Nigeria to the neighbouring nations.
They argued that in many neighbouring countries that had no oil, the issue of subsidies on petrol products did not exist.
“In fact, absence of subsidies in our neigbouring countries has for many years fuelled the incentive to smuggle an estimated 30 per cent of our daily consumption; in effect, we have been subsidising our neighbours,” MOMAN stated.
“We must understand that our oil resources are running out. If this is not enough cause for concern, every day, we see alternative forms of energy being developed and becoming more viable.
“This inevitably will mean that one day in the future, we will either run out of oil or no one will want to buy it because of cheaper alternatives.”
The association noted that the question then becomes how we could afford subsidies at such time.
It said some other oil rich countries decided to go the route of unbridled subsidies but were currently flirting with bankruptcy.
The major marketers observed that as a consequence of deregulation, prices at the pump would have to be adjusted to reflect the realities of changes in ex-depot prices by the Pipelines Product Marketing Company.