The naira on Thursday, 24th August, 2023 crashed in value by 4.54 per cent against the United States dollar at the black market to trade at N920/$ as against N880 it traded on Wednesday. This is according to data obtained by VERY SERIAL from Bureau De Change (BDC) operators in Lagos and Abuja and from other media sources. This means 1 USD is purchased at N900 at the black market and sold at N920, resulting to a profit of N20 per dollar.
The local currency, the naira weakened against the United States dollar at the black market from 880/dollar on Wednesday to 920/dollar on Thursday, raising further concerns about whether the pump price of petrol could be sold at the current price.
The naira which had hit 950/dollar at the parallel market about two weeks ago, rebounded last week.
However, the local currency began a move southward this week, a situation that has unsettled economic managers and stakeholders in the oil and gas sector.
To this end, oil marketers have insisted that a hike in the pump price of Premium Motor Spirit popularly called petrol, is inevitable, following the new round of free fall in the value of the naira against the United States dollar.
Oil dealers and marketers quoted by The Punch Newspaper say with the exchange rate at N920/$, the
pump price of petrol could not remain at N617/litre, particularly if the current exchange rate lingered.
They again projected a cost of between N680/litre to N700/litre for PMS, based on an exchange rate of N920/litre, stressing that the forex rate was about N750/$ to N800/$ at the time the cost of petrol was pegged at N590/litre to N617/litre.
The oil marketers, however, pointed out that since the Federal Government had insisted that it would not increase the petrol price, it must then be “subsidising the commodity secretly, based on the prevalent exchange rate reality.”
Going by the projections and analysis of oil marketers and dealers, it, therefore, implies that the Federal Government might probably be spending about N90 as subsidy on petrol due to the crash of the local currency against the dollar.
It was gathered that the ex-depot price of petrol was around N585/litre on Thursday. The projected cost of N680/litre, going by the current forex rate, means that the government might be forced to spend about N95/litre as subsidy.