Trade union body calls for government support for Dangote and small-scale refineries to reduce petrol prices

The Trade Union Congress has proposed a “production subsidy” for the Dangote Refinery and other modular refineries as a way to reduce the rising cost of premium motor spirit (PMS), commonly known as petrol.

TUC President Festus Osifo made the proposal on Friday while speaking on Politics Today, a current affairs programme on Channels Television.

Osifo said that since the Federal Government has ruled out reintroducing petrol subsidies, alternative measures are needed to ease the burden of high fuel prices on Nigerians.

“So for us as a country, we are making a lot of money. In excess of what we budgeted. All right, so today we make at least $35 or so dollars per barrel beyond what we budgeted,” Osifo said on the programme.

He outlined the TUC’s proposal, focusing on redirecting excess oil revenue to support local refining.

Osifo queried, “So, what we proposed, knowing and understanding that they wouldn’t want to bring consumption subsidy, we were advocating for a production subsidy.

“Production subsidy, in that today we have modular refineries, right?

“So we were advocating that this extra $35, for example, that you are making per barrel, why don’t you take half of it, for example, and use it to subsidise the crude that you are giving to Dangote Refinery and the modular refineries so that they will be able to produce cheaper PMS?”

Petrol prices have surged significantly in recent weeks, rising from about ₦800 to around ₦1,300 depending on location, following the outbreak of the US/Israel-Iran War.

Despite mounting pressure to reinstate fuel subsidies, which were removed when Bola Tinubu assumed office in May 2023, the Federal Government has maintained its stance against the policy.

On Tuesday, Nigeria’s Coordinating Minister of the Economy and Minister of Finance, Taiwo Oyedele, speaking in Paris at an event, said the Federal Government will not reintroduce subsidies or impose price controls, reaffirming its commitment to market-driven economic reforms.

“We will not bring back fuel subsidy because it creates distortions for the economy, and we won’t introduce price control because we believe in the market… the situation in Iran presents new opportunities for us as the world looks to diversify sources of energy and invest in new markets,” said Oyedele.

Osifo, however, urged the government to explore creative solutions to support citizens amid rising living costs.

But Osifo wants the government to “think out of the box and quickly do things to assist its citizens”.