Why Nigerians May Buy PMS Above N500 Per Liter- Economic Expert

An economic expert, Paul Alaje has said Nigerians may buy Premium Motto Spirit (PMS) at price above five hundred naira after some period.

He said if the exchange rate is not peg, it is just a matter of time for Nigerians to buy PMS at a thousand or two thousand naira.

He hinted this on Rave FM Osogbo on Monday that if Nigerians will not experience this, government must adopt a better monetary policy.

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Alaje also said that government must guarantee Nigerians of locally functional refinery or they should peg the exchange rate after subsidy removal.

According Alaje “subsidy should be remove with conditions, what are the conditions, number one there must be functional refinery, NNPC is the sole importers, let assume there are twenty importers today, we will be paying for exchange rate differentials.

“Tomorrow you may hear that the price of PMS if we dont have refinery locally, you may heard the price of PMS has gone, to three hundred naira they will say voice of demand and supply that is why we should remove it.

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“You know what may happen the day after tomorrow it may turn to one thousand two hundred because it is not just the forces of demand and supply that is adjudicating.

“Something that many may not see is the role of exchange rate that is why we need a better monetary policy.

“Let me tell you the meaning because we are importing, if the cost of PMS per litre somewhere in Abere.

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“That filling station opposite Sectariat let assume the cost of PMS is one dollar.

“In 2015, at official figure what was one dollar? 199, so when government says PMS is 195, and we are able to manage our exchange rate, you see that the gap is not much is four naira.

“Fast forward to 2023, official exchange rate is 460, government says for South West is N500 you see that the distant is not much.

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“So it is in Nigeria price are fluctuating in country that has staple currency it is the same.

“If you want to remove subsidy remove it but we have to be guarantee of one of the two.

“Is either refinery remains functional locally in Nigeria or we peg our exchange rate.

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“If we dont peg our exchange rate and you say you remove subsidy it is a matter of time we will buy at one thousand or two thousand.

“And please don’t take my word for it, take example and things that had happened in the past as evidence of what may happen.”