Petrol can sell at N605, fall to N200 without hurting govt revenue -Hashim

From Ndubuisi Orji, Abuja

Presidential candidate of the Accord Party, Gbenga Olawepo-Hashim, has said petrol could sell at a starting price of N605 per litre and eventually fall to between N200 and N300 without reducing government revenue if Nigeria cuts production costs, stabilises the exchange rate and eliminates inefficiencies in the petroleum industry.

Hashim said the proposed N605 per litre would be a sustainable price rather than one artificially maintained through an opaque subsidy regime, insisting that cheaper petrol did not necessarily have to translate into lower Federation Account Allocation Committee (FAAC) revenues.

“N605 per litre is our starting sustainable price for petrol. Nobody will buy petrol above N610 under our government. It could be as low as N200,” he said.

The Accord candidate, who has consistently opposed the removal of petrol subsidy, described previous claims about the subsidy burden as “accounting magic,” arguing that government must first establish the actual cost of producing, refining, transporting and distributing petrol before determining whether consumers are being subsidised.

“Any time you sell a product above its legitimate cost of production, refining, transportation and insurance, you cannot call the difference between that price and an international benchmark a subsidy loss. That is opportunity cost,” he said.

According to Hashim, Nigeria’s petroleum pricing system had relied excessively on comparing the domestic value of crude oil and refined products with international market prices instead of establishing the actual cost of producing and delivering the product locally.

He argued that the approach created the impression that government necessarily incurred a loss whenever petroleum products were sold domestically below international benchmark prices.

“A country does not subsidise itself simply because it chooses to use its own resources to provide affordable energy to its citizens,” he said.

Hashim called for an independent forensic audit of the petroleum industry’s cost structure, covering crude oil production, contracting, procurement, refining, transportation, storage, insurance, pipelines and distribution.

The exercise, he said, should establish what it actually costs to produce and deliver a litre of petrol to Nigerian consumers.

“Show Nigerians the books. Publish the production cost. Publish refinery cost. Publish transportation. Publish insurance. Publish every margin. Let the data speak,” he said.

Hashim questioned why Nigeria’s crude production costs were relatively high compared with some major oil-producing countries, saying contracting practices, procurement, insecurity, operational inefficiencies and possible cost inflation should be subjected to scrutiny.

“Before asking Nigerians to pay more, government must first explain why it costs so much to produce our own oil. If the cost is genuine, show us the evidence. If it is inefficiency, corruption or inflated contracting, fix it,” he said.

He argued that Nigerians were effectively being made to bear the consequences of inefficiency twice — through high production costs within the petroleum industry and subsequently through higher pump prices.

“The Nigerian people should not pay for inefficiency twice. They should not pay for inflated costs inside the system and then be told that the resulting high price is the inevitable consequence of subsidy removal,” Hashim said.

The presidential candidate said his proposed petrol pricing model would be anchored on reducing production costs and achieving what he described as an appropriate exchange rate.

He said an Accord administration would target an exchange rate of between N525 and N700 to the dollar, arguing that a stronger and more stable naira would significantly reduce the domestic cost of petroleum-sector inputs.

“We will achieve this strictly by ensuring appropriate production cost and appropriate exchange rate,” he said.

Hashim insisted that reducing the pump price would not be achieved by sacrificing government revenue.

“The reduction will not be at the detriment of government revenue or below current FAAC. We are not going to make petrol cheaper by making government poorer,” he said.

According to him, lower energy prices could stimulate production, reduce transportation and manufacturing costs, improve household purchasing power and ultimately expand the economic base from which government earns revenue.

“Our objective is not simply cheap petrol. Our objective is a productive Nigerian economy in which affordable energy, stronger production and stronger government revenue reinforce one another,” he said.

Hashim clarified that his projection of petrol eventually selling for between N200 and N300 per litre should be regarded as a medium-term target dependent on correcting underlying economic fundamentals rather than an immediate pump-price promise.

“N605 is the starting sustainable price. If we get production costs right and achieve the exchange-rate target, the price could come down to N200 or N300,” he said.

He said the policy would be complemented by accelerated domestic refining, increased transparency across the petroleum value chain and measures to eliminate waste and leakages.

The Accord candidate maintained that government intervention in petroleum pricing was not inherently wrong, provided it was transparent, targeted and capable of producing measurable economic benefits.

“The issue is not whether government can intervene. The issue is whether government intervention is transparent, productive and accountable. Subsidy should protect Nigerians and the productive economy, not enrich intermediaries,” he said.

Hashim challenged the government to publish detailed petroleum cost data to enable Nigerians to independently assess claims about subsidy and appropriate pump prices.

“Let the data speak. Tell Nigerians exactly what it costs to produce the crude, what it costs to refine it, what it costs to transport it and what every margin represents. Then we can have an honest conversation about subsidy,” he said.

He said the 2027 presidential election should provide Nigerians an opportunity to choose between competing economic models rather than merely between political personalities.

“Nigeria does not have to choose between affordable petrol and government revenue. We can have both. But we must stop using accounting to hide inefficiency and start using economics to build prosperity,” Hashim said.