Advocate500:
Joker's in leadership, Jonathan failed to save when oil was this and that, their was nothing like subsidies, subsidies payment is a scam.
The only reason we are not saving is because oil price have dropped below $50 per barrel, today we are hearing about increase in the oil price, but they are reminding us about subsidies, the government will never accept responsibility for once.

Where are the so called opposition parties?

Basically, for the prolonged period of fall in oil prices, we have to take loans to keep our head above water.

Once oil prices rise again, the loans have to be paid back, so whatever oil windfall we have is gone to loans.

All the more reason why APC has failed...no diversification, no raise in income from taxes, which would have helped.

Opposition parties too have no ideas.

Is Buhari still complaining about oil price as a reason for his poor performance.

And how much was paid when it was $30 per barrel. This government is a disaster.

It's only under satanic Buhari govt that high oil prices means more suffering for Nigerians ...when oil price is low Buhari punishes Nigerians and when it's high he still punishes Nigerians ...which kind devil be this abeg

backbencher:


Basically, for the prolonged period of fall in oil prices, we have to take loans to keep our head above water.

Once oil prices rise again, the loans have to be paid back, so whatever oil windfall we have is gone to loans.

All the more reason why APC has failed...no diversification, no raise in income from taxes, which would have helped.

Opposition parties too have no ideas.

how have this shallow argument explain my opinion, are we borrowing in anticipation of crude oil increase? I thought every loan collected have it mode of repayment captured in the fiscal year?

backbencher:
The reason is simple

Higher oil prices means higher cost of production which means in order to keep the price at N162 per liter, we have to pay more and more for subsidy.

The same money we pay for subsidy comes from the same crude oil revenue.

Keep in mind that as the article said, oil hasn't been above 100 dollars per barrel since 2014 (and our current fiscal breakeven oil price is $133 per barrel). We still have to borrow money to meet up, and we still also have to pay debts....from the same oil money.



Sauce

Throw in the fact that subsided fuel lead to a lot of stealing , be it making false import and transportation claims, as well as mass smuggling...and we can see the problem

Oil subsidy has to go...or we stop taking loans, and tax each and every NIGERIAN , rich or poor, at rates of 40% of annual income to find money for this year's budget. We cannot live in dreamland forever.

Can you explain in simple terms how higher oil price leads to higher cost of production.

Nigeria is cursed.

When crude oil price goes up, we suffer for it

When it goes down, we still suffer for it.

blazetitov:
I hope and pray the Dangote refinery comes on stream this year. That will help the country alot.

do you think dangote will sell cheap fuel to you?

Advocate500:
oga wether Dangote or otedola refinery ,without accountability nothing will work ,get that fact and have peace of mind.

Lol.

Dangote is a private refinery and i guess you don't understand the mechanism of how international oil price affects all aspect of our daily lives locally.

Advocate500:
how have this shallow argument explain my opinion, are we borrowing in anticipation of crude oil increase? I thought every loan collected have it mode of repayment captured in the fiscal year?

Even the increase in VAT and other taxes yet these also contribute to the repayment of the loans borrowed, so are they saying crude oil is the only life line of loan repayment or debt servicing?

Femijohn198:
Our leaders have crippled what belongs to the future of tomorrow. Why can there build rifinaries or repaired the old one not working. Taking our crude resources abroad to refined will costs us more than refining it here in Nigeria. African leaders are thinking from the anus.

their actions are deliberate. Try are fully aware of what they're doing because it allows them to cheat everyone else

Sunnyja:
In 2016, they justified the suffering of the people saying Bubu met low oil prices at $28 per barrel. In 2022, at $80 per barrel the suffering will now be doubled? Wonderful!

I wanted to say same bro..

In fact, they said Jonah had excess money to run the govt with because oil sold for 100$/barrel and that buba met oil at $28/barrel and as such no funds to run the govt.

Now its keeps increasing yearly and yet nothing to show for it..

$80 now ooo and we are hearing same story..

I just can't wait for the general election in 2023

alphaNomega:
do you think dangote will sell cheap fuel to you?

Not like that.

why it affects the economy is the impact of the foreign exchange. If we refine locally, the pressure on our foreign reserves and currency will reduce. We can sell crude to Dangote and any other local refineries in naira and we buy refined products in Naira. Costs of importing, clearing, shipping etc will be eliminated. The county can decide to sell crude to refineries at reduced rate. etc.

You gerrit

blazetitov:


Not like that.

why it affects the economy is the impact of the foreign exchange. If we refine locally, the pressure on our foreign reserves and currency will reduce. We can sell crude to Dangote and any other local refineries in naira and we buy refined products in Naira. Costs of importing, clearing, shipping etc will be eliminated. The county can decide to sell crude to refineries at reduced rate. etc.

You gerrit

No OPEC country will sell crude oil in their local currency. Dangote refinery will buy crude from Nigeria at the international price and being a private refinery, it must sell to make a profit.

Somebody should let FG know that, per Barrel of Perol is now $85 oooo. Excuse still dey?

We have already been paying more unknowingly.

backbencher:
The reason is simple

Higher oil prices means higher cost of production which means in order to keep the price at N162 per liter, we have to pay more and more for subsidy.

The same money we pay for subsidy comes from the same crude oil revenue.

Keep in mind that as the article said, oil hasn't been above 100 dollars per barrel since 2014 (and our current fiscal breakeven oil price is $133 per barrel). We still have to borrow money to meet up, and we still also have to pay debts....from the same oil money.



Sauce

Throw in the fact that subsided fuel lead to a lot of stealing , be it making false import and transportation claims, as well as mass smuggling...and we can see the problem

Oil subsidy has to go...or we stop taking loans, and tax each and every NIGERIAN , rich or poor, at rates of 40% of annual income to find money for this year's budget. We cannot live in dreamland forever.

Please can you explain how the increase in crude oil price in the international market will lead to an increase in cost of production?

alphaNomega:
No OPEC country will sell crude oil in their local currency. Dangote refinery will buy crude from Nigeria at the international price and being a private refinery, it must sell to make a profit.

Yeah. But it will definitely remove one cost factor.

The cost of getting the products from foreign refineries into the country.

What they term as crude landing cost.

I understand that when people have Palm plantations, they will site a mill right there for easy refining of these palm products.

It beats my imagination that a country that produces 2.2 million barrels of crude oil per day does not have working refineries. Where on earth does this kind of thing happen?

No be juju be that? And una say the country get future.

backbencher:
The reason is simple

Higher oil prices means higher cost of production which means in order to keep the price at N162 per liter, we have to pay more and more for subsidy.



Oil subsidy has to go...or we stop taking loans, and tax each and every NIGERIAN , rich or poor, at rates of 40% of annual income to find money for this year's budget. We cannot live in dreamland forever.

The tax will be an excellent idea and will work if any elected, selected, appointed leader, public servant or civil servant caught looting/stealing (even if it is N1) is sentenced to death & executed.

Pay fuel subsidy to Cabar. I can wait till june

masui:


Please can you explain how the increase in crude oil price in the international market will lead to an increase in cost of production?

Easy...oil used for refining fuel is bought at international price...ie the crude oil price.

That's a part of the final cost of every liter of fuel we buy. The higher it goes, the higher the price of petrol goes.

Advocate500:
how have this shallow argument explain my opinion, are we borrowing in anticipation of crude oil increase? I thought every loan collected have it mode of repayment captured in the fiscal year?

Well, the reason why we take loans is simple...oil prices aren't high enough for us, and in a given year can be very very volatile....even going below the minimum government sets for funding the budget

Then there is the fiscal breakeven

At the end of the day, APC and Buhari have to diversify away from oil. That's something many governments, including theirs, don't do

What is meant to be a blessing to a nation is turned into curse for same nation.

We are meant to be jubilation as the barrel price rises but no thats not happening.

We will continue to pay higher subsidies for petrol on the side of government and higher prices on the side of the people as long as we base our domestic price on the international market price instead of the local cost of production.
I can tell us for free that even if all the refineries (both government owned and the proposed private ones) are working at full capacity the downward change in price would be very little perhaps due to the exclusion of freight related cost
Crude oil is the most outrageously priced commodity on planet earth because its price is not based on the cost production but on some extraneous factors such as polical instability and natural disasters in oil bearing areas which could be real, imagined or speculative. We are told by the NNPC that the minimum cost of producing a barrel of crude in Nigeria is $17 as at 2020 and effort is being made to bring it to. $10 I don't know if that has been achieved.
If Government is willing to sell to local refiners at a price slightly above the cost
of production, there is no doubt that this recurring issue of higher subsidies or prices that always accompanied higher international market price Will be eliminated. Government can as a policy cause some local firms to produce crude for domestic consumption as distinct from the one for international market which is based on the quota allocated to her. Converting vehicles to use CNG will only bring temporary relief as sooner or later we are bound to go back to the subsidy issue when the international market price begins to look up as the demand for gas increases exponentially.

Sometimes i try to understand whats going on. During PDP oil was 100 dollars and we are still buying fuel at N87 and now just 85 dollars they are saying we are going to pay more for fuel and at the same time APC will say PDP wasted oil money when it was high. So pls can someone explain to me why e didn't pay as much as N200 for a little when oil was 100 dollars.

Revolution2022:
How can we be paying for a natural resources that we have in our soil?Does Buhari buys fuel from his salary?The minister of petroleum,governors and senators get this fuel for free and they are making us to cough out our hard-earned money to buy a commodity we produce locally at the international price when they are getting it for free.Election time,they will start making false promises.
African rulers are devil's incarnate.

Because it in u have crude under ur soil now means u should get fuel for free..
Ur are an example of the average African ruler ..this is d same mentality that introduced subsidies into the petroleum industry.. Nigerians love for cheap fuel..this single mentality killed our refinery, and drastically reduced forex inflow hence naira devaluation and ultimately revenue that resorted to borrowings...We think we are better off with cheap fuel not knowing we are killing our selves...this same mentality killed the power sector..thank God obasanjo exempted the telecom industries...

Simplythebest:
Sometimes i try to understand whats going on. During PDP oil was 100 dollars and we are still buying fuel at N87 and now just 85 dollars they are saying we are going to pay more for fuel and at the same time APC will say PDP wasted oil money when it was high. So pls can someone explain to me why e didn't pay as much as N200 for a little when oil was 100 dollars.

It simple.. During PDP oil was around 80USD and produced over 2 million barrels daily...
APC time..oil fluctuated downward heavily especially between 2015 and 2017. with 50USD Average pricing and average production of 1.3million barrels... This single thing reduced forex inflow hence naira devaluations.. And since fuel is imported it inevitably means we will pay more...
Now prices are around 80USD...But production is still barely 1.5million.. So we can't get so much forex inflow to increase the value of naira... and more revenue to keep paying more subsidies...

The major factors here include
Forex inflow
Dollar to naira rate
Crude oil price.
Oil production rate.

This four factors is what determines how much Nigerians will pay for any commodity including fuel..

So with ur analysis are we not supposed to buy fuel at cheaper rate now since the oil price is up and we produce more than before. It means that the government will have more money cus the oil bench price set by the government and the excess oil profit that. I think we should have more than dollar now and the fuel should be cheaper. Cus even when the oil was sold 50 dollars we are still paying more cus the told u the reason is the oil price is low and now that high why are still paying more and what do u think we happen when oil price hit above 100 dollars?

Cognitivereason:


It simple.. During PDP oil was around 80USD and produced over 2 million barrels daily...
APC time..oil fluctuated downward heavily especially between 2015 and 2017. with 50USD Average pricing and average production of 1.3million barrels... This single thing reduced forex inflow hence naira devaluations.. And since fuel is imported it inevitably means we will pay more...
Now prices are around 80USD...But production is still barely 1.5million.. So we can't get so much forex inflow to increase the value of naira... and more revenue to keep paying more subsidies...

The major factors here include
Forex inflow
Dollar to naira rate
Crude oil price.
Oil production rate.

This four factors is what determines how much Nigerians will pay for any commodity including fuel..

This is the result of the change they promised Nigeria and even went further to say fuel subsidy is a scam, detective fashola on his side said electricity issues will be fixed in less than 6 months, because of that statement, he was appointed to head 3 ministries (power, housing and work) I could remember that night, he has his hands at back as an humble sheep among them all, 7 yrs after, we're still dealing with the same or worse issues, Nigeria will stop importing fuel, he failed woefully, he couldn't deliver in any of the ministries he heads, he viewed Nigeria as same as Lagos, all the refineries will be fixed in less than 1 yr, dangote's refinary would be ready and commenced operation as early as January 2018, same as 2019, 2020, 2021, now till further notice, here we are today, still struggling with what GOD bless us. Now we're to pay for our own products, it's a shame

backbencher:


Basically, for the prolonged period of fall in oil prices, we have to take loans to keep our head above water.

Once oil prices rise again, the loans have to be paid back, so whatever oil windfall we have is gone to loans.

All the more reason why APC has failed...no diversification, no raise in income from taxes, which would have helped.

Opposition parties too have no ideas.

I disagree with the fact that this administration didn't diversify in terms of income...
They did very well in increasing tax inflow...custom used to generate around 530bn or less during PDP...today custom is generating nothing less than a trillion naira..most time they exhide their target revenue...

The increase of tax rate from 5% to 7.5%..increased VAT generation... Let not also include the fact that they increased tax coverages massively to the point that social media companies are now beginning to pay tax...if u conversant with ministry of budget ..they want to tax everything taxable...in order to increase tax to GDP ratio which was previously an awful 6% rate

The problem is that all this reforms cannot offset the huge gap of revenue loss due to oil down fall...the government makes so much from oil sales..this made previous administration to relax and not bother in diversification.
Also a huge chunk of government budget expenditure and contracts are paid in dollars....with naira devaluation it means more naira has to be paid for contracts in dollars..