FX, VAT pushing diesel price to N950/Litre, job losses loom

Oil marketers have revealed that the price of diesel will hit about N950 per litre going by the volatility in the foreign exchange market.

This volatility, the marketers say, is affecting their inability to import diesel.

They also stated that the recently implemented 7.5% VAT on diesel has also contributed to the increase in diesel price

The development has led manufacturers to say the situation may lead to factories shutting down.

The oil marketers during a press briefing in Abuja said that their inability to access dollars is hampering their ability to import diesel.

President of Natural Oil and Gas Suppliers Association, Benneth Korie said that the cost of diesel was about N650 per litre before the Nigerian government introduced a 7.5% VAT on the product.

Customs and Federal Inland Revenue Service (FIRS) officials revealed that the commodity was not exempted from VAT payment based on the VAT Modification Order.

Korie said in Abuja on Monday, August 14, 2023, that the price is now approaching N900/litre depending on where consumers buy the commodity.

Korie said: “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, the 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 called on President Bola Tinubu to ensure that the refineries are working, stating that the pressure by marketers and other importers would ease when the refineries begin to produce refined petroleum products.

He said Nigerian roads are also in deplorable conditions, stating that about 500 tankers were currently trapped on the Warri-Abuja road.

Meanwhile, manufacturers in Nigeria are fearing job losses and factory closures following the hike in diesel prices.

They say many manufacturers may shut down following the hike as that could push up the cost of production.