The Alliance for Economic Research and Ethics (AERE) has urged the Nigerian National Petroleum Company Limited (NNPC) to publish weekly data on its N66 per litre petrol discount scheme. This includes volumes sold, participating outlets, average discounts, and the impact on its profit margins. AERE also warned that the federal government must ensure that temporary relief measures do not evolve into another petrol subsidy regime. The organisation stressed that transparency, clear expiry dates, and accountability should guide interventions aimed at cushioning the impact of rising fuel prices.
AERE made these calls in an analysis titled: “The N66 Question: Relief Without Relapse: How to Cut Petrol Prices Without Rebuilding the Subsidy Monster.” The group maintained that NNPC should publish a regular performance scorecard to enable Nigerians to assess the reach and cost of the initiative. This scorecard would provide insight into the effectiveness of the discount scheme and its impact on the public.
The NNPC introduced the N66 discount on October 1, 2022, as an Independence anniversary promotion. The Ministry of Finance later incorporated the measure into a 10-point government response to rising petrol prices, with priority promised for public transport operators. NNPC subsequently announced that the discount would continue nationwide until October 31. This move aims to provide relief to motorists and potentially reduce transport costs.
However, AERE cautioned that the absence of a direct budgetary charge did not mean the initiative was without public financial implications. As a state-owned company, NNPC's reduced margins can still affect its contributions to the public purse. The organisation stressed that the discount should remain a time-bound customer-relief experiment rather than a permanent entitlement. This approach would prevent the initiative from becoming a recurring expense.
AERE noted that the discount amounted to about 4.7 per cent of the average petrol price of N1,400 per litre cited by the Finance Ministry, compared with approximately N830 before the latest international oil-market shock. The organisation observed that the discount's reach was limited because it applied through participating NNPC Retail outlets and operated through the NNPC Fuel App. This limited accessibility may hinder the initiative's overall impact.
Checks at Abuja outlets on October 9 found that customers paying directly at the pumps did not receive the reduction. While acknowledging that the initiative could offer some relief to motorists and potentially reduce transport costs, AERE said it was not an inflation policy and did not establish a uniform national pump price. The organisation also warned against a return to blanket petrol subsidies, citing the Finance Ministry's estimate that restoring petrol prices to pre-reform levels could cost more than N20 trillion annually.
AERE argued that the potential fiscal cost of a blanket subsidy made the alternative more perilous. The organisation emphasised the need for a well-designed and targeted approach to cushioning the impact of rising fuel prices. By releasing weekly data on the discount scheme and maintaining transparency, NNPC can ensure that the initiative is effective and does not lead to further financial burdens on the government.
Key points
- The Alliance for Economic Research and Ethics urges NNPC to publish weekly data on its N66 per litre petrol discount scheme to ensure transparency and accountability.
- The organisation warns against a return to blanket petrol subsidies, citing the potential fiscal cost of over N20 trillion annually.
- AERE stresses that the discount scheme should remain a time-bound customer-relief experiment rather than a permanent entitlement.
