Mohammed said a nationwide strike will further worsen the nation's economy.
The Minister of Information and Culture, Alhaji Lai Mohammed, made the appeal on Monday, May 16, while speaking to journalists in Abuja.
Mohammed said a nationwide strike will further worsen the nation's economy, adding that fuel crisis is a global problem and the new price regime was designed to permanently solve the problems.
"For instance, the United Arab Emirates, the third-biggest oil producer in OPEC, has become the first country in the oil-rich Persian Gulf to remove transport fuel subsidies. In addition, the country has announced that with effect from August 1, 2016, fuel prices will be deregulated’’, the minister said.
"Also, in response to fiscal pressure caused by the fall in crude oil prices, OPEC’s top oil producer Saudi Arabia has announced a plan to raise fuel prices. You can now see that this is indeed a global problem.’’
He said the drastic crash of crude oil price, which is the nation’s main foreign exchange earner, the drastic reduction in the amount of foreign exchange available, the unavailability of forex and the inability to open letters of credit, which forced marketers to stop product importation and imposed over 90% supply on the NNPC, forced the government to announce the new price regime.
Mohammed further said: “The truth is that the NNPC does not have the resources for, nor is it designed to meet this increase in supply. The result is the crippling fuel situation across the country.
"Pushed to supply 90% of the products required for domestic consumption, the NNPC has continued to utilize crude oil volumes outside the 445,000 barrels/day allocated to it, thereby creating major funding and remittance gaps into the Federation account.
"As I said earlier, there is no provision for subsidy in the 2016 Appropriation. The erstwhile PMS price of N86.50 gives an estimate subsidy claim of N13.7 per litre which translates to N16.4 billion monthly. There is neither funding nor appropriation to cover this.’’
As a result of vandalism, the Minister said that the Niger Delta had also drastically reduced the national crude oil production to 1.65 million barrels per day, against 2.2 million barrels per day planned in the 2016 budget, saying this had further reducing income to Federation Account and also affecting crude volumes for PMS conversion and impacting Federal Government’s forex earnings.
"Let me also note that the resultant fuel scarcity has created an abnormal increase in price, resulting in Nigerians paying between N150 and N300 per litre as prevalent hoarding, smuggling and diversion of products have reduced volumes made available to citizens.
‘’In the absence of available forex lines or crude volumes to continue massive importation of PMS, it is clear that unless immediate action is taken to liberalize the petroleum supply and distribution, the queues will persist, diversion will worsen and the current prices will spiral out of control.’’
The NNPC has been supplying 90% of the nation's fuel since October 2015, which is in contrast to the past where NNPC supplies only 48% of the national requirement.