While the general public have naturally geared towards the idea of retaining fuel subsidy, the Nigerian government is of a different opinion.
For years now, different administrations have floated the idea of removing the fuel subsidy entirely, with one instance leading to a full on national protest.
The government’s insistence on this notion stems from the fact that the inclusion of fuel subsidy in its expenses incurs more needless spending on the part of the government.
However, should such an idea be fully implemented, it would come at the cost of the public’s convenience, and given the economic climate of the country, coming at the cost of the public’s convenience is a gross understatement.
Fuel hikes as little as 50% in the past has driven up standard of living significantly, particularly in cities that are very mobile and or impoverished, and considering that the nation relies heavily on fuel consumption for both transportation and power supply, a complete removal of fuel subsidy would place a heavy financial burden on the majority of the people residing in the country.
So it comes as no surprise that Nigerians are heavily opposed to the idea of removing the fuel subsidy as a whole. Until the nation is able to refine its own oil, effectively slashing down the cost of fuel by a substantial margin, fuel subsidy would remain something the people would want commissioned.
Regardless, the last quarter of 2022 saw some of the nation’s worst fuel hikes across numerous states.
According to Nairametrics, a news source for economic headlines, some regions in Nigeria saw as much as 100% increase in fuel prices. “Fuel now sells for N450 per liter in Uyo, Akwa Ibom state, N300 per liter in Benin, Edo state, N350 per liter in Calabar, Cross River state, and as high as N500 per liter in Port Harcourt, Rivers state,” an extract from the report details.
These hikes are concerning, considering that the current cost of fuel per liter should be N180, a price that is in itself already considered too high.
A couple of sources revealed that the increment has been alarming as prices in regions like Port Harcourt have sold for as high as N700/liter on the black market.
While the government has touted the removal of fuel subsidy as soon as June 2023, the increase in fuel prices suggests that that subsidy has already been removed.
Experts on the matter, have proposed that the removal be gradual, giving Nigerians time to acclimate with the incremental increase in cost.
Some experts have even suggested that the current increase in price should serve as a prelude to what is about to come, as there is no way to determine how high the cost of fuel would rise should the subsidy be officially removed. Fuel could go up as high as N500, N700, or even N1000 per liter.
There is also the fact that external events outside of the country could catalyze said increase as Nigeria currently lacks the capacity to refine its own oil. As a result, it is very likely that events like the ongoing Russia/Ukraine war could affect how high fuel prices soar in Nigeria.
Regardless of this scare, the Nigerian National Petroleum Corporation (NNPC) assured Niergians that should fuel subsidies be removed, the price of fuel would not go higher than N462 per liter.
