The National Institute for Policy and Strategic Studies (NIPSS) has projected a reduction in fuel prices, predicting that the cost of Premium Motor Spirit (PMS) could drop to as low as ₦750 per litre before the end of the year.
Speaking on The Morning Brief on Channels Television, NIPSS Director-General Ayo Omotayo attributed this anticipated drop to the ongoing operations of the Dangote Refinery and other refining facilities across the country.
“With the removal of the first subsidy, we have Dangote Refinery coming on. We have the other refineries. The refinery in Port Harcourt has worked continuously for 110 days if I’ve counted right! These are the short-term gains,” Omotayo stated.
According to him, while fuel prices currently hover around ₦930 per litre in various parts of the country, continued refinery operations and an improved foreign exchange rate will help lower costs.
“We predict at the National Institute that if we continue with what we are currently doing, fuel by itself will come down. We’re looking at it coming down as low as ₦750 before the end of the year. And of course, foreign exchange, we believe, will still drop to about 1.3 before the end of the year, and it is going to continue like that as more of our refineries come into place,” he added.
Omotayo also emphasized that Nigeria is on the path to becoming a net exporter of refined petroleum products, which will lead to long-term economic benefits despite the initial hardships caused by the removal of the subsidy.
President Bola Tinubu’s decision to end fuel subsidies, which had been a longstanding government policy, led to a sharp increase in fuel prices. However, the NIPSS DG maintained that the removal was necessary to prevent Nigeria’s economy from collapsing under the weight of excessive subsidy payments.
“The subsidies we were paying were just totally unimaginable, and of course, we were subsidizing fuel as far as Burkina Faso, as far as Sierra Leone in some instances. A government that wants to succeed must take very tough decisions,” Omotayo explained.
While acknowledging public concerns over the economic impact of the subsidy removal, he reassured Nigerians that the sacrifices would eventually yield positive outcomes.
