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Oil Nears $56, FG May Reintroduce Fuel Subsidy

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The sustained increase in global crude oil prices has pushed up the landing cost of imported petrol closer to the current pump prices of the product in Nigeria, and appears to have triggered a return to petrol subsidy era, ’ FEMI ASU reports
Since November 13 , 2020 when the pump prices of Premium Motor Spirit ( petrol ) were last increased in the country, the price of the international oil benchmark, Brent crude, has been on an upward trajectory, rising from $41. 51 per barrel to close at $51. 22 per barrel on December 31.

Fuel marketers had in December expected another upward adjustment of PMS prices to reflect the further rise in crude oil prices.
However, a N5 reduction in petrol price, effective December 14, was announced by the Federal Government – a development that left them reeling in shock and questioning the deregulation of petrol price.

Crude oil price accounts for a large chunk of the final cost of petrol, and the country has continued to spend so much on petrol imports for many years amid low domestic refining capacity.

The Minister of State for Petroleum Resources, Timipre Sylva, had said in September last year that the Federal Government had stepped back in fixing the price of petrol, adding that market forces and crude oil price would determine the cost of the product .

The Federal Government removed petrol subsidy in March 2020 after reducing the pump price of the product to N 125 per litre from N145 on the back of the sharp drop in crude oil prices. The price reduction lasted till June.

Nigerians saw increases in the pump prices of petrol in four months, rising from N 121. 50–N 123. 50 per litre in June to N140 .80- N 143. 80 in July , N 148- N150 in August , N 158- N162 in September and N163 -N 170 in November.

Brent, the international oil benchmark, has risen by about 35 per cent since November 13 when the pump price of petrol was last increased. It closed at $55 .99 per barrel on Friday, its highest level in 11 months.

Going by the petrol pricing template of the Petroleum Products Pricing Regulatory Agency, the landing cost of petrol rose from an average of N 143. 60 in December to N158 .53 per litre on January 7, with the expected open market price ( retail price ) being N 181. 53 per litre.
The product is currently being sold at between N160 and N 165 per litre at many filling stations in Lagos.

The cost of petrol quoted on Platts rose to $480. 25 per metric tonne ( N 139. 67 per litre, using N 390/$ 1) last Thursday from an average of $430. 107 per MT ( N125 .09 per litre) in December . The cost of petrol averaged $391. 75 per MT ( N113 .24 per litre) in July , according to PPPRA’ s template .

Apart from the increase in global crude oil prices , the devaluation of the naira last year also led to a significant rise in the cost of imported petrol.

The PPPRA used an exchange rate of N306.90/$1 on January 14, 2020 to calculate the cost of petrol, while N387.63/$1 was used on July 31.

The naira closed at 393.50 against the dollar on Friday at the Investors’ and Exporters’ Foreign Exchange Window, and 472/$1 at the parallel market.

As of January 7, the cost of petrol plus freight stood at $500.72 per MT, translating to N145.62 per litre.

Other cost elements that make up the landing cost include lightering expenses (N4.57), insurance cost (N0.21), Nigerian Ports Authority charge (N2.38), Nigerian Maritime Administration and Safety Agency charge (N0.23), jetty throughput charge (N1.61), storage charge (N2.58), and financing (N1.33).

The pump price is the sum of the landing cost, wholesale margin and the distribution margins. The wholesale margin is N4.03 while the distribution margins comprise transporters allowance (N3.89), retailer (N6.19), bridging fund (N7.51), marine transport average (N0.15), and admin charge (N1.23).

The NNPC, which has been the sole importer of petrol into the country in recent years, is still being relied upon by marketers for the supply of the product despite the deregulation of the downstream petroleum sector.

Private oil marketing companies have continued to lament that their inability to access foreign exchange at the official rates has hampered efforts to resume petrol importation.

If the pump price of petrol is left unchanged amid the rise in oil prices, it means the NNPC would again bear the latest subsidy cost on behalf of the government as it did for several years before its removal last year.

There is currently subsidy, but it is being absorbed by the government through the NNPC,” the National Operation Controller, Independent Petroleum Marketers Association of Nigeria, Mr Mike Osatuyi, told our correspondent.

He recalled that he said in December that petrol pump price was moving closer to N180 per litre, adding that with the current price of crude oil, petrol subsidy would gulp about N800m daily with an average consumption level of 40 million litres.

He said, “Because of the volatility of petrol in the Nigerian political landscape, government does not have the boldness to allow full deregulation of petrol because of the spiral effects on Nigerians, and bearing in mind that Nigerians are in very hard times.”

Osatuyi said, “But the government is supposed to come out and present the subsidy to the National Assembly. They should tell Nigerians that we are going back to subsidy. But because of the loans from the IMF and World Bank that they got with the condition that petrol should be deregulated, I believe the government is trying to manage the problem.

“If we are going to do genuine deregulation, there must be a level playing field for the players. We are not where we are supposed to be; there is still some dark, hidden elements in our ‘deregulation’.

“We are practising monopolistic deregulation – where one player is on the field and it is the goalkeeper, the defender and the referee.”

The President, Petroleum Products Retail Outlets Owners Association of Nigeria, Dr Billy Gillis-Harry, stressed the need for deregulation to be properly done.

He said, “The concern I have is that we are not getting it right. We must think inwards and grow our local production capacity. I don’t know why our refineries should not work.

“Deregulation is the way to go; we want the sector to be deregulated. But we need to do it rightly. There should be a level playing field for all operators; everybody should be able to access forex at the same rate.”

While opposing the return to subsidy, he said, “We call on the government to fast-track the regulatory process to ensure that deregulation is in place.”

It was reported on September 8, 2020 that the Federal Government’s removal of petrol subsidy and the increase in electricity tariff were in line with reforms being sought by the International Monetary Fund and the World Bank.

“The recent introduction and implementation of an automatic fuel price formula will ensure fuel subsidies, which we have eliminated, do not reemerge,” the Federal Government told the IMF in the letter of intent dated April 21, 2020 with respect to its request for emergency financial assistance of $3.4bn.

In July, Sylva said in a statement that the Federal Government had reached a conclusion that it could no longer bear the burden of petrol subsidy.

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BREAKING: Fire Breaks Out In Aso Rock

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A fire outbreak has been reported at the Presidential Villa in Aso Rock, Abuja, causing confusion among workers in President Muhammadu Buhari’s abode, SaharaReporters reports.

It was learnt that the fire started at 4 pm as the fire service officials tried desperately to put it out.

“The security men were chasing people not to capture the incident, but I tried my best to capture it. The fire is still on,” a source disclosed around 9 pm.

Although the cause of the fire is not yet known, fire service trucks have moved in and were seen in the villa.

More details soon….

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We Won’t Allow Hijab In Kwara Mission Schools, CAN Insists

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The Christian Association of Nigeria in Kwara State has insisted that it will not allow its pupils to wear hijab, despite the Kwara State Government’s directive that Muslim female pupils in Christian mission schools should wear hijab.

The state government, last week, said it had approved wearing of hijab by Muslim female pupils in Christian mission grant-aided schools in the state.

It also said the 10 Christian mission schools closed down in the wake of the hijab crisis would be reopened on Monday, March 8.

However, the state branch of the Christian Association of Nigeria said it would not agree to the use of hijab in schools established by Christian missions, alleging that they were surprised that the government was trying to make a decision on a matter that was still before the Supreme Court.

CAN said, “The body condemns the use of hijab in Christian missions grant-aided schools as this will cause discrimination in schools and allow terrorists to easily identify our children and wards.”

Two missions, Evangelical Church Winning All and the Kwara Baptist Conference, said they would not allow the wearing of hijab in their respective schools when the schools reopen on Monday.

The leadership of ECWA said it would not welcome the directive in all its schools in the state.

The Chairman, ECWA Ilorin District Church Council, Rev John Owoeye, who spoke at a press conference in Ilorin on Friday, said ECWA schools were established by Christian missionaries for purposes of reaching communities with the love of Christ and to meet educational needs of the indigenes irrespective of religious affiliations, among other reasons.

The ECWA church leaders, who demanded return of ECWA schools to them, said since 1974 when there was agreement on collaboration between the state government and the proprietor for the school to be grant-aided schools, “the policy has never been total takeover of our schools by the government.”

Owoeye, who said Christians are bona fide citizens of the state, added, “We have equal rights under the provisional constitution of the Federal Republic of Nigeria.”

He argued that the government was aware that Christian Religious Knowledge teachers were not posted to Muslim grant-aided schools and that the gathering of Fellowship of Christian Students was not allowed in Muslim grant-aided schools.

“Similarly, we want the government to be informed that her decision and plan to provide hijab and enforce its use in our Christian mission grant-aided schools will not be tolerated as it is an infringement on our freedom of religion as enshrined in the constitution of Nigeria,” he said.

Also, the President of Kwara Baptist Conference, Rev Victor Dada, in a separate press conference, said the mission would not allow the use of hijab in its 38 schools across the state, adding that the government was wrongly advised in taking the decision.

Dada argued that the state government took a wrong decision by its blanket approval of wearing of hijab for female pupils in mission schools.

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“The state government was wrongly advised to take that decision. The state even acted in contempt of court as the case is still pending before the Supreme Court.

“We want to warn the government that the step it wants to take by approving the use of hijab for all public schools and grant-aided schools in the state will lead to an avalanche of reactions, the end of which no one can predict.

“With this move, the state government is saying the Muslims’ purported rights are superior to those of the Christians.

“What we are saying is that no one, whether the Kwara State Government or even the Federal Government, can force hijab on our children or in our schools. We shall not hesitate to use all legitimate means to protect our heritage. We will defend our faith and protect our property.”

Meanwhile, Muslim stakeholders in the state have urged the state government to stand by the rule of law in taking a final decision on the hijab issue.

In a statement signed by its Chairman, Alhaji Is-haq AbdulKarim; and Secretary, Professor Ibrahim Abikan, the Muslim Stakeholders said the state branch of CAN, which engaged the state government in a legal battle over the issue of ownership of the grant-aided schools since 2013 lost its two cases in Ilorin High Court in 2016 and the Court of Appeal in 2019.

In a related development, Chairman, Kwara State branch of the Nigeria Union of Teachers, Olu Adewara, said the union was not part of the hijab crisis currently going on in the state.

The NUT Chairman, Adewara, told reporters, “The hijab matter is basically an issue between the government, the Muslim parents and the owners of these schools, regardless that such schools are grant-aided by the government. The NUT is not involved because this is not a matter bordering on teachers’ rights.”

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My Ex-Wife Lied Against Me, She Is An Adulterer —Fani-Kayode

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Former Minister of Aviation, Femi Fani-Kayode, has said his ex-wife, Precious Chikwendu, lied against him, adding that he didn’t beat her at any point in time during their relationship.

Fani-Kayode also alleged that Chikwendu was an adulterer who tried to seduce his friends while he was in detention.

The former beauty pageant had accused her ex-husband of beating her up at several times including when she was pregnant.

The ex-wife further accused Fani-Kayode of confining her to a hospital when she attempted to escape.

Chikwendu subsequently demanded for full custody of their four sons.

The former beauty queen made the allegations in an affidavit she deposed to in support of an originating motion brought pursuant to Section 69 of the Child’s Rights Act, 2003.

But in a statement by his Media Consultant, Oladimeji Olaiya, the ex-minister described all the allegations as “lies and falsehood”.

The statement was titled, ‘Press statement on the vile and baseless allegations of Precious Chikwendu against Chief Femi Fani-Kayode’.

It partly read, “The statement of claim and affidavit that was filed in court by one Precious Chikwendu against Chief Femi Fani-Kayode is filled with lies and falsehood.

“Not one thing that she has alleged there is true. She is a pathological liar and a slanderer and we intend to prove this in court.

“We believe that the children’s lives would be in danger if they are with her and we shall prove this in court.

“Neither is it true that she was ever beaten by Chief Fani-Kayode or anyone else in his staff and security team, either when she was pregnant or not pregnant and it is not true that she was subjected to any form of physical or mental abuse from them.”

The statement also noted that Chikwendu walked out of the marriage despite pleas and entreaties.

“She walked out on her own saying she was hearing voices even when the entire household was begging her to stay and she abandoned her husband and four young children to meet other men outside.

“After she finished having her fun Chief Fani-Kayode refused to let her back into his and resolved to keep her out of his life. This is the best decision he has made in the last 7 years.”

Fani-Kayode also accused his ex-wife of adultery, saying, “Chikwendu’s only pastime was to post pictures and words on Instagram and sleep with men outside.

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“She also tried to seduce a number of Chief Fani-Kayode’s friends when he was in detention and extort money from them.”

Though Chikwendu demanded the full custody of her four sons, Fani-Kayode said the children’s lives would be endangered if left in her care.

“On one occasion she beat her first son so badly that his face swelled up like a football and he had to be rushed to the hospital where she admitted to her offence to the doctor. We have pictures of his damaged and badly swollen face.

“His crime was that he had called one of his 3 nannies “mummy” and this angered Chikwendu who then flew into an uncontrollable rage and punched him in the face in front of 7 nannies.

“On a separate occassion in front of three Pastors she also beat one of the triplets mercilessly simply because he had dared to cry during prayers. Again we have evidence of this and the Pastors and nannies will testify,” the statement added.

“We urge members of the public to wait until the truth is revealed about Chikwendu, her mental and physical abuse of her own children, her mental illness, her numerous attempts to murder Chief Fani-Kayode and his four children, her adulterous ways, her unfathomable cruelty, her gold-digging ways, her violence and so much more before they make up their minds,” it concluded.

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