According to the World Bank, since fuel prices aren’t cost-reflective in the nation right now, the federal government might still be covering fuel subsidies.
The World Bank also stated that Nigerians should be paying almost N750 per liter more for gasoline than they are now, at N650.
This was disclosed by the bank’s Lead Economist for Nigeria, Alex Sienaert, on Wednesday in Abuja during his presentation of the Nigeria Development Update, December 2023 edition, entitled “Turning The Corner (from reforms and renewed hope, to results).”
He mentioned that fuel should cost N750 per litre according to today’s official exchange rate for the hybrid event.
He said, “It does seem like petrol prices are not fully adjusting to market conditions so that hints at the partial return of the subsidy, if we estimate what is the cost reflective of retail PMS price of the would-be and assuming that importation is done at the official FX rate.
“Of course, the liberalisation is happening with the parallel rates, which is the main supplier, the price would be even higher. These are just estimates to give you a sense of what cost-reflective pricing most likely looks like.
“We think the price of petrol should be around N750 per litre more than the N650 per litre currently paid by Nigerians.”
He highlighted that the bank is recommending to the government to take additional measures with its bold reforms to secure the benefits from having taken those decisions.
More details soon…
