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During a hearing with the House of Representatives, the Central Bank of Nigeria (CBN) clarified its role in fuel price and forex control.
Clement Osagie, a principal manager in CBN, stated that the CBN does not have control over the price of fuel or the foreign exchange rate between the naira and dollar.
He explained that the demand for fuel has decreased by 30% following the removal of subsidy on the product, and $150 million is being paid monthly for fuel importation through CBN intervention.
Osagie urged the government to promote local production and discourage importation to address the economic challenges.
He also mentioned that there is a direct relationship between imported products and exchange rates, and the removal of subsidy is expected to bring competition and lower fuel prices.
Ogbugo Ukoha, the executive director of Distribution Systems of the Nigeria Midstream and Downstream Petroleum Regulatory Agency, added that market forces of demand and supply determine fuel prices, and the Petroleum Industry Act has given regulators the authority to intervene to prevent cartel building and illegal profiteering.
The chairman of the ad-hoc committee, Babajide Benson, assured that legislative interventions will be made to address the impact of the subsidy regime on the people and emphasized the importance of effective implementation of the Petroleum Industry Act.
