By Prof. Sam Aluko
I spoke to you about it before now. Subsidy means when you are selling a product below cost of production. The Nigerian government and the Nigerian National Petroleum Corporation (NNPC) have never told us the cost of producing a liter of oil in Warri, Port Harcourt or Kaduna refinery. Is it less than what we are selling for now? Is it higher? If the cost per liter is higher, ...they can say they are subsidizing. But if you are importing from other countries and you are selling crude oil, it is an alternative cost. You have the possibility to set up your refineries, refine your product, sell export refine product and make money. They decided to be selling crude oil. It means that it is cheaper for them to sell crude than to refine. So, you cannot be complaining that you are importing at a high price. It is your choice. You feel that it is easier for you to import than to produce. You cannot be telling us that you are subsidizing when it is your own choice to import.
You know the cost of yam in England. A piece of yam in England would be about one pound. How much would you sell five yams here? It is not up to N200. If Nigerian farmers should export their yam to England and we import yam back from England, we would be importing at about 15 times what we are buying in the market here. If the farmer sells his product and the oil producer cannot sell their product to us, that is their business. They have no business telling us that they are subsidizing us because they are facing the easiest option.
Secondly, if they say that a cartel is making a lot of money from importing oil, it is that cartel that you will fight and not the common man who is not the cartel. The common man has no part in it. Now, you want to increase the price for the common people instead of facing the cartel you say are making money.
The oil we are buying in Nigeria is the worst oil imaginable. It is the least quality oil. Our crude is the most qualitative in the world. If they refine it here, we will be getting the best quality oil. They are importing the worst quality oil for the country. So, we export the best quality crude oil and we import the worst quality refined product.