Key Takeaways
- Former Vice President Atiku Abubakar has pledged to restore petrol subsidy if elected in 2027, marking a significant policy reversal.
- Atiku's new proposal outlines a 'production subsidy' aimed at supporting domestic refining, distinct from the previous import-based regime.
- The Presidency swiftly condemned Atiku's plan, labeling it as desperate, archaic, and incompatible with the Petroleum Industry Act (PIA).
- Economists and legal experts warn of the immense complexities, financial costs, and legal challenges associated with reintroducing any form of fuel subsidy.
- The debate highlights the persistent economic hardship faced by Nigerians and the critical need for sustainable energy policies.
Former Vice President and African Democratic Congress (ADC) presidential candidate, Atiku Abubakar, has reignited a contentious national conversation by pledging to restore petrol subsidy if elected president in the 2027 general elections. This declaration represents a significant departure from his earlier stance, where he had not opposed the subsidy's removal and even advocated for its scrapping during the 2023 election cycle.
Atiku made his latest promise during a Facebook Live interview with select Hausa language news platforms, where he sharply criticized the economic fallout of the subsidy removal. He questioned the utilization of the substantial savings announced by the federal government, arguing that the policy had failed to deliver expected benefits to ordinary Nigerians, with the cost of living continuing to soar without commensurate improvements in public services.
However, Atiku clarified that his proposal is not a return to the old, opaque import-subsidy regime. Instead, he unveiled details of a 'production subsidy' under his Atiku Economic Recovery Plan (AERP) 2027. This plan aims to replace the previous system with a targeted, capped, transparently budgeted, and independently audited mechanism designed to lower energy costs by accelerating domestic refining. "My proposal is not to resurrect the old subsidy regime. We will move subsidy from importation to production, from middlemen to Nigerian refineries, and from unverifiable claims to verifiable barrels. The principle is simple: the subsidy will follow the barrel," Atiku stated, emphasizing that qualifying Nigerian refineries would receive domestic crude at preferential prices, subject to strict conditions.
The Presidency, through Bayo Onanuga, Special Adviser to the President on Information and Strategy, swiftly dismissed Atiku's pledge as a display of "desperation for power" and a proposal from an "archaic past." Onanuga argued that Atiku lacks comprehension of current economic dynamics, particularly given that the Petroleum Industry Act (PIA) 2021 made the old subsidy regime illegal from June 2023. He stressed that restoring the subsidy would be retrogressive, fiscally irresponsible, and incompatible with the legal and structural changes in Nigeria's petroleum sector, including the emergence of significant domestic refining capacity like the Dangote Refinery.
Economists and legal experts largely echo the Presidency's concerns, highlighting the immense practical, financial, and legal hurdles to reintroducing a broad-based subsidy. Dr. Ayodele Oni, an energy lawyer, pointed out that Section 205 of the PIA mandates that wholesale and retail prices of petroleum products be determined under unrestricted free-market conditions. Any attempt to reintroduce a subsidy would necessitate amending the PIA or establishing a complex, constitutionally sound price-support mechanism, potentially triggering disputes with state governments over revenue allocations.
Professor Sheriffdeen Tella, an economist, emphasized that Nigeria has moved beyond the subsidy issue, which was primarily tied to fuel importation. With the Dangote Refinery and other emerging local refineries, the focus should be on increasing domestic production and ensuring adequate supply, rather than diverting funds from critical sectors like infrastructure, education, and healthcare to support fuel imports. Experts also warned that a return to subsidy could foster fraud, smuggling, and undermine investor confidence in Nigeria's deregulated petroleum industry, especially given the volatility of a floating exchange-rate regime.
The debate underscores the enduring challenge of balancing economic reforms with the welfare of citizens. While the Tinubu administration maintains that subsidy removal was necessary to free resources and curb corruption, the immediate consequence has been a sharp increase in petrol prices, transportation costs, and overall cost of living, placing immense pressure on households and businesses. The government claims N158 trillion in savings from reforms between June 2023 and December 2025, but many Nigerians feel the benefits have yet to materialize.
Why This Matters
Atiku's controversial pledge to restore fuel subsidy, albeit in a reformed 'production' model, forces a critical national conversation on Nigeria's economic direction and the sustainability of its energy policies. This debate is crucial as it directly impacts the daily lives of millions, the stability of government finances, and the long-term viability of the country's petroleum sector reforms, demanding clear, fiscally responsible, and legally sound solutions to alleviate economic hardship without reversing hard-won progress.