When Chief Olusegun Obasanjo became the president of the Federal Republic of Nigeria on May 29, 1999, the price of premium motor spirit (PMS), popularly known as petrol, was N19 per litre. Eight years later, precisely on May 27, 2007 , the pump price of petrol had risen to N75 per litre, while the value added tax was jerked up  100 per cent.

Nigerians were treated as though they were not important in decisions that affected their lives. The former president bestrolled the nation in his eight-year rule as if nothing else counted except his cronies and himself. His government poured out anti-people policies in the name of reforms. The way and manner the reform was executed left much to be desired.

Truly, when Obasanjo became  president in 1999, the downstream sector could  then be described as chaotic. Availability of petroleum products was problematic because no individual or company moved near importation of the products. The operating price cap for the products made such venture unattractive; the national oil company, the Nigeria National Petroleum Corporation (NNPC), was then the sole importer.

The need to open up the sector, and make it all inclusive, led to the partial deregulation of the sector in 2003. In fairness to the government, the partial deregulation led to some remarkable achievements in the sector. So many new players came into the marketing sub-sector with the establishment of farm tanks and filling stations across the country.

But one major contentious issue in the deregulation drive at the downstream is  price cap. The government, in an effort at freeing the petroleum products from the price problem, employed all sorts of tricks and jargons like the removal of subsidy.

As it was in the past, subsidy today remains the most unpopular weapon government employs anytime it effects an increase in price. The last increase to N75, which was brought down to N70 by the present government, was seventh since 1999, yet subsidy till date remains, the only word government results to when questioned on the rationale behind any increase, and the frequency of the necessity of having to remove subsidy has made the word subsidy unattractive to Nigerians.

The landing cost of petrol at the nation’s ports today, with overhead cost added,  is N105.00, so should government  remove  subsidy on petroleum products as was  disclosed by the group executive director, Commercial and Investment of the NNPC, Mr Aminu Baba Kusa, on Saturday.  The going price for PMS in the country would not be less than N110. And that is the economic price and the only price that could break the monopoly of the NNPC on importation.

But the big question is, why should government fail to live up to its responsibility by continuing to give succour to its citisen through subsidy?

It is a known fact, even to the people on the street, that government is making a lot of money from the sales of our crude oil.

The crude oil price at the international market currently hovers between $65 and $70, and Nigerians know  that petrol which our government is using to frustrate them economically is just a minute product of the  crude oil which we have in abundance. They also know that DKP and AGO and other products are gotten from just a barrel of this crude oil that is sold for between $65 and $70 in the international market.

It is also an incontrovertible fact that Nigeria has comparative advantage in the exploration and production of a barrel of crude oil.

Shell Petroleum Development Company, with all community related problems it has to contend with, produces a barrel of crude oil in Nigeria at $7 per barrel, while Mobil, with no serious community related problems, produces a barrel of crude oil in Nigeria at $5, to mention just a few companies. The question now is, how much does  it cost these companies to transport our crude oil to the international markets? How much is the over-head cost? Nigerians may also be aware that if all other variables were added, it would not be up to 1/3 of what our crude is being offered in the international market.

The Nigeria government is in joint venture arrangement with most of these companies, with Nigeria having the lion share in the sharing of the profit. Where then is the rationale behind the so called subsidy, they argued.

More than half of the proceeds from the joint venture comes into the federal government’s purse, yet the same government has been subjecting its national oil company, the Nigeria National Petroleum Corporation, to all sorts of embarrassment by making it  import the finished products into the country at a loss.

The unwholesome arrangement of the government is the genesis of our problem today. Even when the NNPC refineries were at various level of their production capacity, the federal government sold this same crude oil, that is produced at the backyard of the Pot Harcourt and Warri refineries, at less than $8 at the international market. Unfortunately for the NNPC, its fluid catalytic FCC unit at the Port Harcourt refinery  has been malfunctioning, which makes its production of white products such as petrol, diesel and kerosene at a great uneconomic price .

The minister of Petroleum Resources, Dr Rilwan, recently told the nation that  removal of subsidy on petrol was the key to the policy of deregulation  and that the non- implementation of the policy at the downstream sector made it difficult to get people into the refining business in Nigeria, and that also is the reason the 17 companies licensed to build and operate refineries in the country seven years ago have not advanced much as it was envisaged in the beginning.

But the truth of the matter is that the federal government failed to create the right atmosphere for the people who are interested in establishing  refineries. The licensees said they could not understand why government would sell Nigerian crude to Nigerian companies operating in the country at international price, moreso when it is obvious that will be morally wrong for the government to ask Nigerians to pay international price for the refined petroleum products.

Appeals from these licensees to government to relax its policy and accommodate local necessities in its crude oil pricing regime fell on deaf ears, and the result of the nonchalance of the government is what we are witnessing today. No single refinery is working in the African number one producer of crude oil and no new one was established in the last 20 years.

The planned   removal of fuel subsidy by November this year is already causing panic in the industry.

Investigation shows that major marketers of petroleum products are not at ease  over the planned removal of the subsidy  due to the controversial N70billion they claimed the federal government was  owing  them under the Petroleum Support Fund.

They said that should the government go ahead with the removal of subsidy, the chances of recouping the debt would be slim.

Already, some marketers have kept importation of some petroleum products like Dual Purpose Kerosene which fall under the government harmer, at bay. Chief operating officer of African Petroleum Plc,Mr.Tunde Falasinu,told newsmen recently  that his company has ceased importation of kerosene due to the shaky planned deregulation of the downstream and removal of subsidy on oil products.

A former national president,Independent Petroleum Marketers Association of Nigeria [IPMAN],Tunji Adeniji, however, described the planned removal of subsidy as the best thing to happen to the nation's oil industry.According to Adeniji , removal of subsidy will translate to removal of inefficiency and ineptitude from the management of the nation's oil and gas resources.

He argued that the exercise will neither cause shortage nor shoot up prices as is being speculated  but would ensure healthy competition and free flow distribution of products.

He added that the planned deregulation would, among other things, promote competition and bring about  emergence of new players in the sector, as well as ensure the revitalisation  of the existing 5000km pipeline networks across the country and re-development of new ones.

President of Manufacturers Association of Nigeria[MAN],Alhaji Bashir Borodo, in his comment, insisted that there was nothing wrong with deregulation and removal of subsidy on petroleum products as evidence has shown that it has succeeded in advanced economies.

He said the main issue is for the government to ensure that transparency is the watchword of the exercise, whereby there would be healthy competition among marketers of petroleum products so that consumers would have value for their money.

He, however, regretted certain pre-conditions for the deregulation policy,like ensuring that the nation's refineries are working, is not there.

This, according to the MAN's president, would pave way for some distrust middlemen to hijack the whole programme.

The MAN's president had  during the association's AGM in Lagos announced that about 820 companies had closed shop in the country between year 2000 and 2008,adding that cost of petroleum products has also caused a shiver down the spines of most manufacturers .

He said the cost of diesel and Low Pour Fuel Oil[LPFO]has remained on the high side, while  effort of the association to partner the government in ensuring direct importation of the products has been thwarted. Borodo  said that for Nigerians to derive any benefit from the deregulation of the downstream sector, government must  re-work its plans on some of its lapses like ensuring that the refineries are back in shape and opening multi-channels through which products could be channeled.

According to the president of the Trade Union Congress[TUC],Peter Esele , the planned deregulation of the downstream and removal of fuel subsidy is an anathema designed to snuff out life out of the suffering Nigerians.

He said Nigerians would not derive anything from it as the policy is scripted to give certain advantages to some few powerful persons over the suffering masses.

''There is absolutely nothing to gain from the policy. There is nothing to ameliorate the biting effects the policy would create for Nigerians. In Indonesia and other countries that have embraced the policy before us,there are safety nets and thus the citizens are not suffering,  and they are rather enjoying it. ''Here, there is no safety net thought by the government. It is really dangerous for the government to embrace it and coerce the citizenry into accepting.''

And until Nigerians stand up  to say no to all anti-people policies of the ruling party, so shall we be galloping from one crisis to  another. A word is enough for the wise.