Tonye Cole, co-founder of Sahara Group, has highlighted the significant pressure on the Nigerian National Petroleum Company (NNPC) Limited due to the burden of petrol subsidy payments and the importation of petroleum products.
In an interview with Channels Television, Cole explained that NNPC is absorbing the true costs of petroleum, which has strained its cash flow and operational capabilities.
Cole noted that the ongoing debate about the existence of the petrol subsidy is linked to NNPC’s role in maintaining petrol supply at lower costs, despite the national oil firm recently claiming it is owed N7.8 trillion by the federal government for subsidies.
He emphasized that the pressure on NNPC affects its ability to focus on its core functions as a producer and developmental company.
To ensure consistent petrol supply and avoid scarcity, Cole suggested that Nigeria must shift its focus away from over-reliance on the oil and gas sector.
He stressed the need for monetary policies that reduce pressure on the Naira and foreign exchange, allowing NNPC to manage its pricing and operational challenges more effectively.