By Michael Oche
Trade Union Congress (TUC) on Thursday said the federal government must strengthen the naira against the dollar to crash the price of petrol, which rose to 1,030 per litre on Wednesday.
On Thursday, the naira exchanged at almost 1,680 to a dollar, and the TUC
urged the government to grant a special foreign exchange (FX) intervention in the oil sector that will stabilize the exchange rate at N1,200 to crash the price to petrol to at least N700 per litre.
Speaking to journalists in Abuja, TUC President, Comrade Festus Osifo, explained that floating of the naira is a major cause of the continous increase in the price of petrol.
He argued that no government in the world leaves critical sector to the dictate of the market, adding that the Forex intervention is the only solution to addressing the high cost of petroleum products.
He emphasized that three key elements—accessibility, availability, and affordability—are crucial for ensuring energy security in Nigeria.
“So, first, on accessibility, as things stand with the Dangote Refinery, we call on the government, through the industry regulator NMDPRA, to issue licenses to all marketers, allowing them to source products from the refinery. If Dangote has the capacity to provide the minimum 35 million liters of PMS consumed daily in Nigeria, then all marketers should be granted access to distribute the product across the country,” Osifo said.
“Next is availability. We understand that the Dangote Refinery’s capacity is 650,000 barrels per day, potentially producing in excess of 50 million liters. However, we need clarity from the regulator on whether Dangote is currently producing 35 million liters per day, and whether there is the capacity to evacuate that volume daily from the refinery. This is crucial for resolving the availability issue,” he added.
Osifo also urged the government to expedite all necessary support and approvals for Dangote Refinery to ramp up production to at least 40 million liters per day.
“While efforts are made to increase production, we need to bridge any shortfall by sourcing additional fuel externally until the refinery can meet domestic demand. This will ensure that availability issues are sufficiently addressed,” he said.
On affordability, Osifo reiterated the TUC’s long-standing demand for special FX intervention in the energy sector.
“If the government intervenes by providing FX to Dangote Refinery at a rate of ₦1,200 to $1, the price of PMS could fall to well below ₦700 per liter,” he noted. “No government leaves such a critical sector entirely to market forces, and energy is a critical sector. A targeted intervention in this area would stabilize PMS prices, bringing them below their current levels.”
He explained that although crude oil is sold to Dangote Refinery in naira, it is priced in dollars, as crude is an internationally traded commodity. Thus, converting the value of crude from dollars to naira is necessary, which affects the final cost of fuel.
Osifo said, “Government intervention in the form of a special FX scheme will not only reduce PMS prices but also make the Dangote Refinery more efficient, helping to employ more Nigerians and drive down fuel prices to levels seen in June last year.”