Nigeria's Fuel Subsidy Debate Exposed as 'Accounting Magic'

Accord Presidential candidate Gbenga Olawepo-Hashim has described Nigeria's fuel subsidy debate as 'accounting magic.'

Olawepo-Hashim believes that the high price of petrol in Nigeria is largely due to how the government accounts for and prices domestically produced crude oil.

He argued that Nigerians have been misled into thinking that cheaper petrol is unaffordable, when in fact the actual cost structure suggests otherwise. According to him, the current price of petrol is inflated by the government's pricing of domestic crude at an excessively high level.

Olawepo-Hashim pointed out that Saudi Arabia produces oil for around $10 per barrel, compared to Nigeria's $30 per barrel domestic crude price. He calculated that adding a $15 margin, approximately $5 for refining, and $7 for transportation and insurance would put the total at about $57 per barrel.

This could translate to a petrol price of about 34 cents or roughly N501 per litre at an exchange rate of N1,400 to the dollar. He proposed a pump price of N605 per litre, which includes an additional energy tax of about N100 that can be deployed to develop alternative energy sources.