Transparency Lacking in Oil Sector; Appropriate Petrol Pricing Remains Elusive, Says Prof. Iledare

Transparency Lacking in Oil Sector; Appropriate Petrol Pricing Remains Elusive, Says Prof. Iledare

Determining the appropriate price for petrol in Nigeria remains a complex challenge due to pervasive opacity in the oil and gas sector, according to industry expert Prof. Wunmi Iledare.

Prof. Iledare, a Professor Emeritus in Petroleum Economics and Policy Research at the Centre for Energy Studies, Louisiana, made this assertion during his appearance as a Guest Speaker on the popular monthly interview discourse, BOILING POINT ARENA, aired on Sweet 107.1FM and hosted by Dr. Ayo Arowojolu.

In his discussion on “The Nigerian Socio-Political and Economic Quagmire: What are the Rescue Options?”, Prof. Iledare criticized the sector’s lack of transparency, particularly regarding proprietary data that remains hidden from public scrutiny. This, he argued, hampers the ability of Nigerians to obtain fair value for petrol despite the country’s natural resources.

Responding to a question about why local refineries like Dangote’s cannot offer lower prices despite not having forex components and the often-discussed issue of landing costs, Prof. Iledare used a Yoruba phrase, “E ma tuwo rara,” meaning, “Don’t go there,” indicating the complexity and opacity surrounding the issue.

Prof. Iledare elaborated: “There is a general lack of transparency in the oil and gas sector. Don’t go there at all because you will not like what you see, and perhaps suffer the consequences too. Understanding is deeper than knowledge!”

He criticised the current state of leadership in the sector, labelling it as “transactional” rather than “transformational.” He noted that instead of a unified vision, there is a misalignment where the Presidency, rather than the Ministry of Petroleum, plays a central role in oil and gas policy. This, he contended, deviates from the expectations set by the Petroleum Industry Act (PIA).

Prof. Iledare also expressed concern over the lack of public education about the sector, which he attributed to a tendency towards economic populism.

He criticised the subsidy regime, which he believes perpetuates poverty and dependence on borrowing.

Furthermore, Prof. Iledare condemned the ongoing disputes between NNPCL and the Dangote Group. He argued that Dangote, a figure he views as patriotic, should be supported rather than blamed. He called for a collaborative approach between the government and Dangote to address issues in the downstream petroleum market effectively.

“The government blaming Dangote is a mistake,” he said. “Dangote is a patriotic man who should be celebrated rather than condemned. The government must work with him to find a solution to our petroleum downstream market.”