Rewane Proposes Refinery-Based Subsidy for Nigeria

Bismarck Rewane, the Managing Director of Financial Derivatives Company, proposed a radical change to Nigeria's fuel subsidy framework by advocating for a refinery-based subsidy system. In a recent television interview, he argued that this approach would directly benefit consumers and stabilize fuel prices by leveraging local refineries.

Rewane emphasized that the government should supply crude oil to domestic refineries at subsidized rates, allowing refined petroleum products to be sold at lower prices. He noted that the current spike in crude oil prices, influenced by geopolitical tensions, has led to a significant increase in pump prices across Nigeria.

For instance, petrol prices in Lagos rose from N1,260 to N1,360 per liter, while diesel reached N1,950 per liter. Rewane also pointed out that the Dangote Refinery requires 19.5 million barrels of crude oil monthly to operate at full capacity but currently faces supply limitations from the NNPCL, which manages only 5 million barrels monthly.

The World Bank has warned that Nigeria's poverty rate has risen to 63%, affecting 140 million Nigerians, exacerbated by inflation and rising transport costs.