• 4 minutes Energy Armageddon
  • 6 minutes "How to Calculate Your Individual ESG Score to ensure that your Digital ID 'benefits' and money are accessible"
  • 12 minutes "Europe’s Energy Crisis Has Ended Its Era Of Abundance" by Irina Slav
  • 4 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 3 days Is Europe heading for winter of discontent with extensive gas shortages?
  • 24 hours Wind droughts
  • 4 days "Natural Gas Price Fundamental Daily Forecast – Grinding Toward Summer Highs Despite Huge Short Interest" by James Hyerczyk & REUTERS on NatGas
  • 2 days Kazakhstan Is Defying Russia and Has the Support of China. China is Using Russia's Weakness to Expand Its Own Influence.
  • 2 days Oil Prices Fall After Fed Raises Rates
  • 12 days How Far Have We Really Gotten With Alternative Energy
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 10 days "Russian oil executive and Putin critic Ravil Maganov dead after mysterious six-story fall" - The New York Post
  • 2 days 87,000 new IRS agents, higher taxes, and a massive green energy slush fund... "Here Are The Winners And Losers In The 'Inflation Reduction Act'"-ZeroHedge
  • 7 days Beware the Left's 'Degrowth' Movement (i.e. why Covid-19 is Good)
  • 10 days The Federal Reserve and Money...Aspects which are not widely known
Energy Was Key In Putin-Xi Meeting

Energy Was Key In Putin-Xi Meeting

The meeting between Russian President…

Gasoline Subsidy To Cost Nigeria 10 Times More Than Budgeted

The rising cost of crude oil will increase the cost of Nigeria’s gasoline subsidy by nearly ten times what it had originally budgeted, Nigeria’s President Muhammadu Buhari said in a recent letter to lawmakers.

Nigeria’s Petroleum Motor Spirit subsidy is now set to cost 4 trillion naira this year, or $9.6 billion. This compares to Nigeria’s previous projections, which called for just 443 billion naira in gasoline subsidies.

Even though Nigeria is a major producer of crude oil, the high price of crude oil has come with drawbacks for Africa’s largest crude oil producer. Nigeria swaps at least a portion of its crude oil for gasoline—which it then sells at a loss.

Nigeria imports nearly all of the gasoline it consumes. And with today’s high prices, Nigeria is selling this gasoline at a very steep loss in order to keep gasoline prices at 162.5 naira per liter (39 cents). For perspective, in 2020, Nigeria’s petroleum imports exceeded its exports by $43 billion.

The letter, dated April 6 and seen by Bloomberg, called on lawmakers to increase the amount budgeted to continue subsidizing the price of gasoline.

Nigeria is in the midst of a fuel crisis that has seen vehicles lined up at gas stations to fuel up, in part due to its lack of refinery output, and in part due to some substandard gasoline it had imported earlier this year, which contained too much methanol.

Nigeria’s President signed a law last August that would end the costly gasoline subsidies by February 2022 but later reversed this notion, instead extending them for 18 more months to stave off fuel protests.

Nigeria has just four crude oil refineries with a combined nameplate capacity of 445,000 bpd—enough to meet domestic demand. But the state of disrepair of Nigeria’s refineries means it must still import 80% of all its refined products. A new 650,000 bpd refinery in Nigeria is expected to begin production in the fourth quarter of this year.

By Julianne Geiger for Oilprice.com

More Top Reads From Oilprice.com:



Join the discussion | Back to homepage



Leave a comment

Leave a comment

EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News