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Nigeria news: NLC vows to oppose deregulation of oil industry

Another National strike action looms in the offing in Nigeria as the Central labour union has warned that it would oppose Government plans to deregulate the oil industry amid fears that it would lead to higher fuel prices.

 

“We are completely opposed to any planned increase in the price of petrol in the name of deregulation of the downstream sector of the economy,” Nigeria Labour Congress spokesman Owei Lakemfa told AFP.

Levi Ajuonuma, spokesman of the state-run Nigerian National Petroleum Corporation (NNPC), said the deregulation policy “will come into force on November 1.”

He declined to say if the government move would mean a price hike.

The last time prices of petroleum products were increased was in 2007 shortly after President Umaru Yar’Adua came into office as part of the deregulation move.

The NLC organised more than six nationwide strikes to protest frequent hikes in the prices of petroleum products under president Olusegun Obasanjo (1999-2007).

Services were grounded across the country for days and weeks the strikes lasted.

Officials argue that deregulation will promote competition in fuel imports, free market, efficiency and ultimately force prices to come down.

But NLC said the prices of kerosene and diesel that were hiked in 2007 have neither come down nor the supply of the commodities improved.

It maintains that petrol price hike would create more hardships for the poor as it would trigger inflation and transport costs.

“Government is shirking its responsibility to the nation. It is the duty of government to ensure a good standard of living for its citizens. Any government that cannot do this should resign and leave,” said Lakemfa.

Newspapers reported that the pump price of a litre of petrol could rise by 68 percent next month, from current 65 naira (43 cents) to 94 naira (63 cents).

Nigeria’s four refineries are producing less than 30 percent of their installed capacity, forcing the continent’s leading oil-producing nation to import refined products to meet local demands.

Nigeria currently produces about 1.7 million barrels of crude daily, most of which are exported abroad.

Officials said Nigeria spends hundreds of billions of naira annually to subsidise imported petroleum products and money saved from deregulation of the downstream sector could be used to provide services and improve infrastructure.