The Federal Government on Wednesday finally approved the payment of N407.07bn as fuel subsidy to oil marketers.
The payment was confirmed by the Minister of Finance, Mrs. Kemi Adeosun, through a statement signed by the Director of Press, Ministry of Finance, Mr. Marshal Gundu.
The payment, according to the statement, includes arrears from the 2014 financial year as well as that for the current year.
The minister said in the statement that the approval was given following a directive by President Muhammadu Buhari that the amount be paid immediately to the oil marketers in order to end the lingering fuel scarcity in the country.
She called on the marketers to reciprocate the gesture of the Federal Government by ensuring that queues by motorists disappear within the shortest time possible.
The fuel scarcity, which has been on for about a month now, has caused severe hardship to Nigerians.
Adeosun said despite dwindling revenues, the Federal Government was still committed to ensuring that petroleum products were made available to Nigerians.
The statement read in part, “The Minister of Finance, Mrs. Kemi Adeosun, has confirmed the payment of N407,076,805,386.30 for subsidy claims to oil marketers so as to end the lingering fuel situation.
“The minister stated that the President had directed that payment be made immediately in order to bring to a quick end the lingering fuel crisis, which has caused great suffering to Nigerian families and businesses. She also said that despite dwindling revenues, the government was committed to ensuring continuous availability of fuel to Nigerians.
“The payment includes arrears from the 2014 financial year as well as payment for the current year. It is expected that the recipients would ensure adequate supply of fuel to end the persistent fuel shortage in the nation.”
A total of N143bn was approved by the National Assembly in April this year for subsidy payment for the 2015 fiscal period.
A breakdown of the amount showed that the sum of N100bn was provided as subsidy on Premium Motor Spirit, while N43bn was approved for Dual Purpose Kerosene.
Following the utilisation of the amount, President Muhammadu Buhari had sent a supplementary budget to the Senate requesting additional N413bn for payment to the marketers.
However, the Senate increased the subsidy budget by N109bn, bringing the amount approved by the upper chamber for that purpose to N522.25bn.
Meanwhile, Nigeria’s crude oil grades, Forcados and Bonga, which have been lagging behind other grades, have become less attractive to their usual European refinery buyers, Platts, a United States-based provider of energy and metals data reported on Wednesday.
Forcados crude’s differential to Dated Brent was said to have fallen to its lowest in six years because seasonal European demand for distillates remained weak, with storage capacity in the region not seeing the usual drawdown in stocks due to mild weather.