Barbara Bako, Abuja.
The Federal Government has unveiled fresh measures to cushion the impact of rising petrol prices, including a 30-day discount at NNPC stations and a proposed N1,350 per litre ceiling on the ex-gantry or landing cost of petrol.
The Minister of Finance and Coordinating Minister of the Economy, Prof. Taiwo Oyedele, announced the measures on Thursday at a press briefing in Abuja on the fuel price situation and the debate over subsidy.
Oyedele, however, ruled out a return to blanket petrol subsidy, arguing that such a policy would place significant pressure on government finances and undermine the gains recorded since the subsidy was removed in 2023.
Under the proposed price-modulation arrangement, the government is negotiating with refiners and importers to keep the ex-gantry or landing cost at about N1,350 per litre.
Where market costs rise above the agreed level, refiners and importers would temporarily absorb the difference and recover it when crude prices or exchange-rate conditions become more favourable.
Oyedele said the arrangement would be reviewed monthly and the relevant figures published, stressing that the measure is intended to smooth price volatility rather than restore subsidy or impose permanent price control.
The government is also offering a discount on petrol sold through NNPC stations for the next 30 days, with public transport operators to receive priority.
Oyedele said the intervention was necessary because the surge in international crude prices had translated into higher domestic fuel, transportation and logistics costs.
According to him, crude oil, which traded at about $70 per barrel before the Gulf conflict, has risen above $100, while the average petrol price in Nigeria has moved from about N830 to around N1,400 per litre.
He said the government was conscious of the pressure on households and businesses but maintained that returning to the former subsidy regime would create greater economic risks.
Nigeria consumes about 50 million litres of petrol daily, the minister said, adding that a N500-per-litre subsidy would cost more than N16 trillion annually, while returning petrol to its pre-reform price could push the annual cost beyond N20 trillion.
Oyedele said subsidy removal between June 2023 and December 2025 released about N15.8 trillion to the Federation Account, with approximately N10.4 trillion accruing to states and local governments.
He warned that reversing the policy could weaken government revenues, put pressure on the naira, raise borrowing costs and threaten recent improvements in Nigeria’s sovereign credit ratings.
Beyond the immediate price interventions, the Federal Government announced plans to increase the supply of crude to local refineries through forward crude sales, remove illegal taxes and road levies that add to transportation costs, expand cash transfers and subsidised credit, and accelerate the conversion of vehicles to compressed natural gas.
The government is also considering an excess-profit tax, with proceeds earmarked for transport support and vouchers for low-income Nigerians.
Oyedele said the government would further work towards establishing a National Strategic Fuel Reserve and improving traffic and logistics systems to reduce fuel consumption and transportation costs.
The minister also highlighted existing interventions, including petroleum tax and duty waivers, which he said had provided savings of between N400 and N600 per litre and resulted in more than N5 trillion in potential revenue being forgone.
He said the government had also continued to support the CNG transition, with more than 120,000 vehicles converted, over 400 conversion centres established, alongside 96 refuelling stations, 18 L-CNG stations and more than 550 CNG buses.
During the question-and-answer session, Ismaeel Ahmed, Executive Vice Chairman of the Presidential Compressed Natural Gas Initiative (PCNGI), explained that vehicle conversion to CNG currently costs between about N230,000 and ₦580,000, depending on the vehicle and conversion requirements.
He said financing arrangements were being developed to allow vehicle owners to pay for conversions over time, while noting that the CNG infrastructure was still expanding.
On revenue collection and the cost imposed on businesses by multiple levies, Olusegun Adesokan, Executive Secretary of the Joint Revenue Board of Nigeria (JRB), said efforts were ongoing to harmonise taxes and charges across the country.
Adesokan said 20 states had adopted the harmonised framework, while discussions were continuing with relevant security agencies to tackle illegal collections on the nation’s roads.
Also responding to questions, Bashir Adewale Adeniyi, Comptroller-General of the Nigeria Customs Service, addressed issues relating to revenue administration and the movement of goods.
Senator Heineken Lokpobiri, Minister of State for Petroleum Resources (Oil), also participated in the briefing and responded to questions concerning developments in the petroleum sector.
Earlier, Mohammed Idris, Minister of Information and National Orientation, said the government’s focus had shifted from implementing difficult reforms to ensuring that the benefits of those reforms translate into improved living standards.
He said the administration’s objective was to move the economy from a period of reform towards sustainable prosperity, with greater emphasis on production, investment, jobs and stronger businesses.
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