…Labour demands wage awards, directs crude sales to local refiners

AT N1,430 per litre, one litre of petrol costs about two per cent of the minimum wage, 10 litres would cost N14,300, which is more than 20 per cent of the monthly minimum wage, brutally exposing the dire predicaments of Nigerian workers.

President of the Nigeria Labour Congress (NLC), Joe Ajaero, who bemoaned the rising cost of living, said the cost of the petrol crisis has piled more pressure on workers who are already stressed by the costs of food, rent, electricity, school expenses, and healthcare are considered

In a statement yesterday in Abuja, Ajaero argued that the latest surge in petrol prices is putting a fresh squeeze on Nigerian households already struggling with severely weakened purchasing power, with workers on the national minimum wage facing a widening gap between their incomes and the cost of necessities.

With petrol selling for as much as N1,430 per litre in parts of the country, the latest increase has added another layer of pressure to household budgets at a time when wages have failed to keep pace with the rising cost of living.

Labour said the impact is even more immediate for millions of workers and low-income households who depend on public transportation.

As fuel becomes more expensive, transport operators face higher operating costs and commuters face higher fares. The additional burden then moves through the economy as the cost of transporting food, farm produce, building materials, manufactured goods and other necessities rises.

Ajaero warned that the increase would further erode wages and worsen Nigerians’ living conditions.

The NLC is therefore demanding immediate measures, including reasonable wage awards, increased supply of crude to domestic refineries through naira transactions, and expansion of national petroleum storage capacity.

The labour position is that workers should not be left to absorb the full impact of an external oil-price shock through wages already under severe pressure.

The latest increase has also exposed the vulnerability of an economy in which domestic petrol prices remain closely affected by movements in the international oil market.

The country is itself a major crude-oil producer. Yet, rising international crude prices can translate into higher domestic petrol costs, increasing the cost of living for the same population from whose natural resources the country derives oil revenue.

This is in addition to the higher oil revenue accruing to the government.

That contradiction has become more consequential for households because their incomes do not automatically rise when crude prices rise.

Indeed, the reverse is happening: higher international oil prices increase government and industry revenues while also raising the domestic cost of transportation and production.

This creates two-sided pressure on citizens, highlighting a paradox of income and the challenge of rising living costs.

The country is earning more from crude exports while workers spend more to get to work and feed the family.

The immediate consequence is likely to be further adjustment in household spending.

Families already operating on tight budgets may have to cut spending on food quality, healthcare, education, savings, and other non-food necessities as transportation and energy costs absorb a greater share of their income.

The implications are even more terrifying for informal workers, petty traders and small businesses.

The pressures are more direct. Higher transportation and energy costs raise the cost of getting goods to markets, while weak consumer purchasing power limits businesses’ ability to pass the full increase on to customers.

The danger, therefore, is not only inflation in the conventional sense but a further deterioration in real incomes, reflected in the quantity of goods and services wages can actually purchase.

Against this backdrop, labour’s demand for government intervention has shifted the debate from the price of petrol itself to the broader question of how to protect Nigerian households from external energy shocks.

Ajaero argued that government should provide an immediate buffer through wage awards, secure crude supplies for domestic refineries in naira and strengthen strategic petroleum storage.

Labour insisted that in a struggling economy, sharp rises in the price of a basic energy source, where wages are already struggling to support basic consumption, cannot be measured at the filling station alone.

The Nigeria central labour body added that people’s daily struggles must be understood in terms of what households can no longer afford.