Quick one on 5 September 2022
On Freshly Pressed with Shopsy this morning, we asked how the NNPC came to the conclusion that petrol will sell for ₦462/litre without the subsidy.
Personally, I think the NNPC is just involved in unnecessary fear-mongering in order to protect their fraudulent gains from the subsidy scam. Our neighbours, who are poorer, pay a lot more than we do for petrol. What I see in all this is people committed to maintaining their cushy subsidy scam going on.
Consider the above chart, published in February. As of February, based on the exchange rate, we were paying 40 cents per litre of petrol. In Benin it was 95 cents, in Niger it was 97 cents, in Chad it was 89 cents, and in Cameroon, it was $1.09.
If you have been to these countries (and the only one I’ve not been to is Chad), you’d notice very quickly that in most cases, especially close to the border with Nigeria, people don’t buy petrol from petrol stations, but from the black market.
Because it is cheaper.
Why is it cheaper?
Because big brother Nigeria is involved in a loss-making jamboree, and some smart chaps are able to get the petrol at $0.4 in Nigeria and sell at $0.6 across the boundary.
Who won’t buy the cheaper fuel and save the $0.35 as a Beninoise?
Heck, a friend once saw a chap rolling across the border in Adamawa State on his bicycle, with two kegs of petrol. He was going to sell.
Essentially, even the common man in the border towns is in on the action, and why wouldn’t they?
It is logical, which brings us to the missing crude that the NNPC’s boss said amounts to $14.6 billion per year. The best amount that Nigeria can make in a hypothetical scenario of 2 million bpd at $100 for a year is $73 billion. This amount mentioned is exactly 20% of that. We know that Nigeria produces just over half of that amount, so what these guys are implying is that about 50% of our oil production is stolen.
When you consider that MV Heroic Idun scenario it all makes sense.
Let us refresh our memories: a 3 million barrel supertanker was in Nigeria for days, and no one saw it. Do you see how all these scams are adding up?
Anyway, make I go hunt for my morning agbado…