Nigeria’s subsidised petrol smuggled as far as Mali, say Customs

The Nigeria Customs Service has said Premium Motor Spirit, popularly known as petrol, is being smuggled out of Nigeria in large quantities after it has been subsidised by the Federal Government.

According to the border security outfit, the petroleum product is being diverted to as far as Mali.

The Controller-General of the NCS, Col. Hameed Ali, decried that the Department of Petroleum Resources had approved the establishment of filling stations along the land borders, while the Nigerian National Petroleum Corporation keeps supplying the commodity to the stations against Customs’ advice.

Ali said the situation was responsible for the increasing volume of fuel being released by the NNPC as daily consumption.

The Customs boss stated this in Abuja on Monday at the public hearing organised by the House of Representatives’ Committee on Finance on the 2022-2024 Medium Term Expenditure Framework and Fiscal Strategy Paper.

Chairman of the committee, James Faleke, had earlier asked the Minister of Finance, Budget and National Planning, Zainab Ahmed, why the Federal Government has projected crude oil per barrel at $57 for the 2022 budget when the global market prices are now about $70.

Ahmed, however, said the government was using the differentials to pay subsidy on petrol, which is referred to as under-recovery.

The minister had said, “The crude oil price that we propose in the budget is a result of consultations with the NNPC and a review of the research that is done by EIA as well as the World Bank and other institutions. And we normally just take a middle road. We don’t look at the price today; we look at the projections for the price, for 2022, 2023 and 2024.

“Also, fortunately for us, right now, the increase in the price of crude oil should have resulted in more revenue to the federation. But because we are suffering a significant level of under-recovery as a result of fuel subsidies, the impact is not seen.”

But Ali decried that apart from spending on subsidies, the subsidised fuel was being smuggled to other West African countries where the pump prices were higher.

The Customs boss said, “The issue of smuggling of fuel from Nigeria to the neighbouring countries is simply because of price differential. The prices outside our shores and borders are higher, and that is what attracts people to move this product outside. And this product is not only limited to Benin, Niger or Chad, it goes up to Mali.”

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