Minister of State for Petroleum resources, Timipre Sylva has said that income for the Federal Government has reduced by 60 percent, making it impossible to return to oil subsidy regime.
“The earnings of government has reduced by 60 percent and what is happening in the oil sector reflect what is happening elsewhere.”
Sylvs, who spoke today, November 16 to newsmen shortly after briefing President Muhammadu Buhari at the presidential villa, Abuja, said that even the Federal Inland Revenue Services (FIRS) collection “has also reduced because less oil is being produced.
“There is less activity in the oil industry which is driving the economy. So you find out that it is a double whammy from all sides.
What we have said over and over again as a government is that government is no longer in the business of fixing pump price , that is the meaning of deregulation and stepping back on subsidy.
“Yes, we are very aware that this will result to some increase but why do we have to do this? It is because it is clearly impossible for government to continue to subsidize. The money is not there now “Just take the example of our production levels; our crude oil production level was over 2 million barrels a day but today, to comply with OPEC cut and quota, we have reduced production to 1.4 million barrels.
“Having reduced production to 1.4 million barrels ,crude oil is also not selling at an optimal rate .Where do you get the money to continue to subsidize.”
The minister of state said that Nigerians have to make a choice, saying: “if government were to continue with subsidy, it means for example that at some point, we may not even have money after subsidizing petrol to pay salaries. You have to choice. it is very clear that today things are not as they were before.
‘I am telling you, if Mr. President could have continued with subsidy he would have . But when you look at the facts before us , it is not possible and of course, we are seeing some of the effects but I belive that at this point, we are still trying to cross the first buck. We will get there , we will get used to it as Nigerians.
“The only explanation to everything we have said is the country just could not afford subsidy anymore. It is unfortunate we are experiencing some of these things now . We will get by. I am sure when things stabilize, our earnings begin to improve, we will begin to see the benefits of what this government has done.”