A prominent economist and Managing Director of Financial Derivatives Company Limited, Bismarck Rewane, has argued that it is impossible for fuel to sell at N1,200.
Making this argument during an interview with Channels Television, Rewane argued that fixing the pump price of fuel will bring the nation’s economy to its knee.
Naija News reports Rewane went on to say that a N1,200 increase in the price of fuel at the pump would make it more expensive in Nigeria than it is in other countries and encourage stakeholders to begin smuggling fuel into the nation.
“That is not possible because at N1,200 per litre petrol price in Nigeria will be more expensive than all the neighboring countries and in that case there will be smuggling of petrol into Nigeria rather than out of Nigeria… What i think i understand is that petrol could range from N600 to as high as N1,200 depending on what goes into the template, there is a misunderstanding of concepts here so i will ignore that. At N1,200 per litre, the distortionary effect to the allocation of resources and prices and the knock on effect on other prices will be so significant that it will bring the economy to its kneels so I do not think it is realistic to even consider that at this point in time,” Rewane said.
Rewane made his remarks one day after some news reports revealed that there may be a fuel price increase to N1,200.
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The reports were refuted by the Nigerian National Petroleum Company Limited (NNPCL), which declared that there were no intentions to raise fuel prices.