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Fuel Subsidy Removal Sparks Surge in Fuel Prices to N600 per Litre, Fuel Stations Close, Causing Worsening Queues

Less than 24 hours after President Bola Tinubu declared an end to fuel subsidy, the pump price of Premium Motor Spirit, commonly known as petrol, has skyrocketed to N600 per litre from N195 in many parts of the country.This sudden increase in fuel prices has triggered a 100 percent hike in transport fares and has led to long queues at fuel stations across major cities and urban areas, including Lagos, Abuja, Ilorin, Benin, Asaba, Port Harcourt, Kano, Makurdi, and others.In response to the President’s declaration, fuel outlets took advantage of the situation and raised the pump price, causing consternation among citizens who are now forced to buy fuel above the official price. For instance, some participants in a Twitter space session reported purchasing fuel at N600 per litre in Nnewi, Anambra State, and at N700 per litre in Ondo State.The reemergence of long queues at fuel stations has further exacerbated the scarcity as many outlets have shut down and refused to dispense fuel to motorists. This has created desperation and panic buying at the few fuel stations that remain open.President Tinubu’s decision to end fuel subsidy was pronounced during his inaugural address at the Eagle Square on Monday. He noted that the 2023 Appropriation Act did not provide for petrol subsidy beyond June, which marks the end of the 18-month extension period approved by the previous administration for the discontinuation of the subsidy regime. Data from the Nigerian National Petroleum Company Limited and the Nigeria Extractive Industries Transparency Initiative revealed that the petrol subsidy under former President Buhari’s administration amounted to N6.88 trillion.The sudden increase in fuel prices has led to various consequences across the country. In Lagos and Ogun states, transport fares have risen by 100 percent, and there are long queues at fuel stations. Many fuel stations in Ikotun, Igando, and Egbeda in Lagos experienced extensive queues of motorists. Similar situations have been observed in Nasarawa, Niger, Abuja, Ilorin, Calabar, Benin, and other cities.To address the fuel crisis, President Tinubu held a meeting with Mele Kyari, the Group Chief Executive Officer of the Nigerian National Petroleum Corporation (NNPC), and Godwin Emefiele, the Governor of the Central Bank of Nigeria, among others. Kyari stated that the Federal Government cannot fund the subsidy anymore, as it owes the NNPC N2.8 trillion spent on petrol subsidy. He emphasized that the subsidy payment was no longer sustainable and made it difficult for the company to fund its core operations.Kyari also acknowledged the reemergence of fuel queues nationwide and explained that the uncertainty over the subsidy removal announcement had led to panic buying among consumers. He assured Nigerians that the government would implement measures to mitigate the effects of the subsidy discontinuance.In response to concerns about potential price exploitation by marketers, the Nigerian Midstream and Downstream Regulatory Authority (NMDPRA) stated that it would not impose any price caps on petroleum products. The NMDPRA assured Nigerians that it was working closely with the NNPC and other stakeholders to ensure a smooth transition, uninterrupted supply, and fair consumer treatment.Meanwhile, President Tinubu clarified that the fuel subsidy removal would not take immediate effect, contrary to the panic-buying that ensued after his speech. He stated that the subsidy removal was a process that had been ongoing and emphasized that there was no need for Nigerians to engage in panic-buying.The situation has prompted governors, such as AbdulRahman AbdulRazaq of Kwara State, to caution oil marketers against creating artificial fuel scarcity.


Ademola Adeyemi

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