Since May 31, 2023, the Federal Government of Nigeria has saved over N400 billion as a consequence of the elimination of the subsidy on Premium Motor Spirit, often known as gasoline, oil marketers reported on Thursday.

Additionally, the oil traders predicted that the price of gasoline will likely increase in July given the Federal Government's recent decision to allow the naira to float against the US dollar.

On June 14, 2023, the Central Bank of Nigeria combined the nation's currency rates into the window for investors and exporters, enabling market forces to set the exchange rate.

Operators in the downstream oil sector told our correspondent on Tuesday that Nigeria had now saved hundreds of billions since ending the subsidy regime in May, based on the revelation of the Nigerian National Petroleum Company Limited regarding the amount being spent previously on subsidies every month.

Speaking to the Punch Newspaper, a Nigerian news agency, the National President of the Independent Petroleum Marketers Association of Nigeria, Chinedu Okonkwo, noted that the removal of fuel subsidies has been beneficial in the context in which it was intended.

He stated: “Right now they (the government) are making money. At least with this removal of subsidy, the government has racked in hundreds of billions, whether in naira or dollars. This is because every month we know how much they lose before.”

Referring to statements made by the company's Group Chief Executive Officer, Mele Kyari, during a meeting with oil sector operators in February, the statement claimed that marketers had been informed of the amount of money the NNPCL spent on subsidies on a monthly basis.

At the meeting, Kyari had said, “Today, by law and the provisions of the Appropriation Act, there is a subsidy on the supply of petroleum products, particularly PMS imports into our country. In current data terms, three days ago, the landing cost was around N315/liter,” Okonkwo stated.

“Our customers are here; we are transferring to each of them at N113/liter. That means there is a difference of close to N202 for every liter of PMS we import into this country. In computation, N202 multiplied by 66.5 million liters, multiplied by 30 will give you over N400bn of subsidy every month,” he added.

Also, following the elimination of the subsidy on Premium Motor Spirit, which has continued to put a strain on Nigerians, organized labor has urged the population to be patient as it engages in negotiations with federal government representatives.