Dollar scarcity: Price of diesel may increase, manufacturers may shut down -Benneth Korie

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As Nigerians groan under the weight of the petrol subsidy removal, oil marketers yesterday, said the foreign exchange crisis in Nigeria and the recent implementation of a 7.5 per cent Value Added Tax on Automotive Gas Oil, also called diesel, had pushed up the cost of the commodity to between N900 and N950/litre in many parts of the country.

As a result, some local manufacturers have said the situation may lead to closure of some factories.

During a press briefing of the Natural Oil and Gas Suppliers Association of Nigeria in Abuja, the marketers explained that their inability to access the United States dollars was impeding their ability to import diesel.

The National President, NOGASA, Benneth Korie, told journalists that the cost of diesel was around N650/litre before the Federal Government introduced a 7.5 per cent VAT on the commodity.

On June 20, 2023, the Federal Government commenced the implementation of the payment of 7.5 per cent VAT on diesel.

Officials of the Nigeria Customs Service and Federal Inland Revenue Service had confirmed this in Abuja, stressing that AGO was not exempted from the payment of VAT based on the VAT Modification Order 2021.

NOGASA President at the event said, “Diesel price is now approaching N900 to N950/litre depending on where you are buying it from. Before the introduction of VAT on diesel by the FIRS, diesel was around N650/litre.

“This increase in price is also due to the scarcity of the dollars. The government has to intervene in this dollar situation. All bank CEOs, Central Bank of Nigeria and others must meet to address this dollar issue. The way it is going, it will destroy a lot of things for us if it is not controlled.”

He however called on President Bola Tinubu to get Nigeria’s refineries working. He said the pressure by marketers and other importers on dollars would reduce when Nigeria’s refineries start to pump out refined products.

“Our refineries were built by human beings and can be fixed by human beings. I believe Nigerian engineers can fix these refineries, instead of us depending on imports. This is not sustainable.

“We are pilling pressure on the very limited dollars in the country by importing petroleum products and other commodities. But once our refineries start working, this pressure will drastically reduce. The government has to fix our refineries,” he said.

“For two weeks now our tankers have been on that road; you can’t cross it. Our roads are bad, our trucks trapped on the Warri-Abuja road for two weeks, our drivers are kidnapped, killed, while others suffer.

“Some of the roads are blocked. If the government does not fix those roads, then petroleum products will stop coming to Abuja and other locations across the country,” Korie stated.

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