The Guardian
Email YouTube Facebook Instagram Twitter WhatsApp

For acceptable petroleum sector deregulation




IF we must deregulate the petroleum sector in Nigeria, there is only one way it can work without social and economic repercussions on poor Nigerians. First, the fuel that is imported into Nigeria is unleaded petrol.

Second, in those days, we used to have Four Star Gallon Petrol and Two Star Gallon Petrol. The petrol that is produced by the refineries in Nigeria let them add lead to it because most of the cars that are driven by poor people in Nigeria are old cars that are over 10 years old which the poor people can afford.

Those old vehicles (cars that are more than 10 years old) were made for leaded petrol because they were manufactured before unleaded fuel gained prominence abroad.

Further, because you cannot get leaded petrol abroad anymore, the car dealers in these countries started selling these old cars to Nigerians who shipped them down.

Today, all the modern cars that have been manufactured in the past ten years have been for unleaded petrol. Abroad, they have super unleaded petrol and ordinary unleaded petrol, while the petrol that is imported into Nigeria is the cheapest ordinary unleaded petrol.

Now, the way you can do the deregulation is very simple. Anybody who can afford to buy a brand new car or a car that is not more than 10 years old is rich enough to buy petrol at any price, that is my own point of view because, that person belongs to the elite of Nigerian society, the 10% people that are rich.

The people buying the cars that are more than 10 years old also belong to the 20% after the above 10%, because at least they can buy cars and there are so many people, about 70% of Nigerians who cannot afford to buy a car.

Next, you talk of the 20% after the above 30 per cent, who are the people with motorcycles. The people with motorcycles, like those who buy cars that are over 10 years old, can use leaded petrol too because, they also belong to the poor class.

The unleaded petrol that we import let them brand it unleaded petrol and leave it with the colour that it comes with from abroad.

The petrol that is produced by Nigerian refineries let them add lead and colour that is different from the imported unleaded petrol and it should be branded Leaded Petrol. Let them keep selling the Leaded Petrol at the current price of N87 per litre, while the unleaded petrol that is imported should be sold at the new deregulated price of N150 per litre.

Anybody who has a brand new car or that of 10 years old one should be prepared to pay the extra N63 to make sure that his car is running smoothly on unleaded petrol, which it was designed for they the rich people who can afford it. The poor people use public transport (buses) and old cars and motorcycles that will still be buying the leaded petrol at N87.

The rich man will not want to go and buy the leaded petrol at N87 because he knows that would amount to penny wise, pound foolish in view of what he would spend to fix his car if spoilt by the tainted fuel, hence he will opt for unleaded petrol at N150. That way, the social aspect is resolved without hurting the poor.

Regarding colour differentiation, we hope that the petrol stations will be honest and not start mixing them up. That requires policing. The DPR should be made more effective. Abroad, there is clear differentiation of the product and stands factual as told by fuel operators and attendants since such is verifiable.

Consequently, owners of petrol stations must stress sincerity in all dealings and the implementation should be devoid of cheating.
•Dr. Akin-Olugbade is the Aare Onakakanfo (Field Marshall) Of Owu Kingdom.

Receive News Alerts on Whatsapp: +2348136370421

1 Comment
  • emmanuel kalu

    not a bad idea, however one of the best problem with nigeria is implementation. so the best solution is to deregulate the market, and let market forces deal with the pricing and supply. what the regulator can do is ensure that quality product is sold and that people are not ripped of due to price.
    what the govt can do to help the masses is to use the saving from subsidies to help reduce the intial increase. what the govt should do with saving, is to purchase mass transit buses, which would be given to states to run mass transit. the fare for this transit would be reduced to help those using mass transit.