The World Bank has indicated that the Federal Government of Nigeria may still be shouldering the burden of fuel subsidy due to the current non-cost-reflective fuel prices in the country.
According to the Lead Economist for Nigeria at the World Bank, Alex Sienaert, the cost of petrol should be approximately N750 per litre, which is significantly higher than the existing N650 per litre being paid by Nigerians.
Sienaert made this revelation during his presentation of the Nigeria Development Update, December 2023 edition, titled ‘Turning The Corner (from reforms and renewed hope, to results),’ in Abuja on Wednesday.
He emphasized that the prevailing petrol prices do not seem to fully align with market conditions, hinting at the potential resurgence of the fuel subsidy.
Speaking on the matter, Sienaert stated, “We think the price of petrol should be around N750 per litre more than the N650 per litre currently paid by Nigerians.” He pointed out that these estimates take into account the cost-reflective pricing based on the official exchange rate, and the situation would be even more pronounced with the liberalization occurring at parallel rates.
The World Bank economist urged the government to consider additional measures to secure the benefits of its bold reforms, emphasizing the need for a careful assessment of the fuel pricing structure. Further details on this developing situation are expected to unfold shortly. Stay tuned for updates.
