The daily fuel subsidy has risen from N2 billion in April to N2.02 billion in May, thus placing much financial burden on the Federal Government.
The development, our correspondent learnt is fueled by an increase in the price of many crude oil grades, including Nigeria’s Bonny Light, presently hovering in excess of $105 per barrel at the global market.
Investigations showed that the increase is also as a result of charges involved in fuel importation and storage at depots.
Consequently, the May template of the Petroleum Product Pricing Regulatory Agency, PPPRA, showed that the subsidy, which stood at N49.81 per litre in April, increased to N50.62.
This culminates in N2.02 billion per day as the Federal Government needs to import about 40 million litres daily to meet domestic demand.
Specifically, the PPPRA puts the landing cost, insurance, trader’s margin, lightering expenses, NPA, financing, jetty depot thru’ put charge and storage charge at N132.13.
The agency puts distribution margins such as retailers, transporters, dealers, bridging fund, marine transport average and admin charge at N15.49.
It also puts the total cost at N147.62 and official exdepot price at N81.51, thus arriving at an under recovery price of N50.62 per litre.
A survey showed that the domestic market is well-supplied with the product and that there is no threat, capable of leading to shortage.
Meanwhile, major marketers said they have increased supply to assist in tackling shortage experienced in many parts of the country.
The Executive Secretary of Major Marketers Association of Nigeria, Mr. Timothy Olawore said fuel supply in many parts of the country has stabilised as a result of increased importation.
Some weeks ago, the Federal Government released N41.074 billion as fuel subsidy payment to 27 marketers.
The Special Adviser on Communications to the Minister of Finance, Mr. Paul Nwabuikwu stated in a statement that the various claims of marketers were properly verified before the payment.
Nwabuikwu stated that the ministry would continue to ensure transparency and accountability in the management of the fuel subsidy regime.