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Is
deregulation a credible option?
Naturally, a sore point in the impact of
deregulation is price; price at which the ultimate consumers get the
products. This issue has generated much heat, including upheavals in the
society. In the last two years, for instance, prices of petroleum products
have been increased about nine times, generating such negative responses
as strike actions and vituperations on the person of President Olusegun
Obasanjo. Granted that the buck stops on the table of the number one
citizen, it is important to understand and appreciate the state of the oil
industry in Nigeria today.
First and foremost, a sizeable
proportion of petroleum products marketed in Nigeria today is imported
mostly by private firms. With a weak domestic currency, the naira,
importers have to source the foreign exchange at the prevailing rates, and
sell the products for a decent profit.
Those who assume that
government revenue should be dumped into subsidiary for petroleum
products, tend to forget that government is accountable to the people in
several other sectors and sub-sectors of the economy, polity and society
at large.
The combined output of the
nation�s four refineries is some 445,000 barrels per day. As it is, they
are barely functional, though there is no firm explanation as to why this
is so. However, on new refineries, it is pertinent to note that it is a
high-technology, capital intensive project. Unlike a prefabricated
structure, the setting up of a refinery is a medium to long term
process.
Acts of terrorism,
vandalisation and theft have also helped to create huge gaps in supplies.
From a combination of connivance and indifference, most communities
through which product pipelines pass have tacitly aided and abetted
disruptions in supplies. From revelations of those arrested, most acts of
vandalisation are sponsored by entrenched local interests and their
foreign collaborators, who resent a stoppage of the culture of �easy
money�.
There is also the issue of
unscrupulous marketers, especially the so-called �independent marketers�.
Though there are the Department of Petroleum Resources (DPR) and Petroleum
Products Pricing Regulatory Agency (PPRA), these cannot possibly monitor
the activities of the marketers nationwide. Ironically, the majority of
Nigerians who would condemn the government on price increases, have
subscribed to the often ridiculously high rates at which the �independent
marketers� sell the products. This is the case across the country, where
demand keep increasing daily due to the heavy dependence on land
transportation by Nigeria will always put pressure on the supply of
transport fuels and the demand is growing, what with most homes and
offices owing power generating sets to supplement public power
supply.
The oil industry, for now, is
the mainstay of not only the Nigerian economy, but of the polity and
society as well. This deregulation should indeed prioritise the welfare of
the citizen as the ultimate beneficiaries. It can be done, and it is right
to believe operators would agree. After all, it is this same citizenry
that are their customers as they are the real focus of good
governance.
Patrick
Asumagbo,
No. 30 Ogedegbe
Street,
Warri � Delta
State.
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