When Badmus Ezekiel was alerted about the removal of fuel subsidy, he carried his keg of fuel to purchase some liters before the implementation. Unfortunately for him, his expectation dwindled in the mud on getting to the filling station.
He looked with utter rage as the attendant told him and others that the price of fuel had drastically augmented to an amount they could not afford.
The 40-year-old entrepreneur, who claims that he usefully buys up to 30 liters of fuel to power his generator for his beverage business, had no option than to purchase 15 liters of the fuel.
As against the normal price before the declaration, Badmus bought the fuel at the rate of 500 per liter, after struggling amidst others for long hours.
Is Removal of Fuel Subsidy A New Dawn in Nigeria?
In his inaugural speech on the 29th of May, 2023, the new President-elect of Nigeria, Bola Ahmed Tinubu declared that the usual subsidy would be removed on petroleum products.
Ever since the announcement, Nigerians have been in disarray as people were disturbed and flustered about the recent development.
Narrating their ordeals, the residents of Akungba-akoko in Ondo State like Ezekiel, decried the sudden change, describing the action of the president as “a round peg in the square hole of the country”.
Over the years, the removal of fuel subsidy has been a contentious issue in Nigeria. Proponents argue that removing subsidies would free up substantial government resources that could be redirected to critical sectors such as education, healthcare, and infrastructure development.
According to this publication, removing fuel subsidy refers to the government’s decision to eliminate or reduce the subsidies provided on petroleum products, particularly on gasoline or petrol. Historically, Nigeria has heavily subsidized fuel prices to alleviate the economic burden on its citizens, as the country is one of Africa’s largest oil producers.
It is also claimed that subsidy removal promotes efficiency, curbs corruption, and encourages private sector participation.
Data from the OPEC‘s website says that Nigeria’s petroleum and other liquids production has remained consistently high, with a daily average of 1.86 million barrels in 2019.
Meanwhile, the country has been accumulating petrol subsidy arrears, with a total of 4.4 trillion naira ($11.4 billion) owed to fuel importers, according to a 2018 report by Nigeria’s Debt Management Office.
Fuel subsidies have also led to a distortion in the market, as the artificially low prices have encouraged smuggling and illegal exports of fuel to other African countries. This has resulted in a significant loss of revenue for the Nigerian government and the country’s economy.
More Sad Tales… “Subsidy Is A Scam”
Ezekiel told this outlet that he is in a state of discomfort about the urgent action without being pre-planned by the citizens and without taking anything into consideration.
“Generally, if we are to look at it, it’s a good move in the wrong direction. It’s something that the country is supposed to have done for a long time. And even if such should happen, it should come with a plan.
“There must be a plan in place so it won’t affect the citizens. This is not a good plan for the masses at all,” he said.
Clearing his throat for a while, he argued that the action is going to affect the day-to-day activities of the citizens, especially those in the commercial and transportation sectors.
“It is no news that anything that affects petrol will take a hard toll on all and sundry. For everything we do, we depend on electricity and this fuel scarcity will cause increment in the prices of goods
Even those selling vegetables in market would be affected because transportation charged will be skyrocketed. Subsidy is a scam in which not not even one percent of citizens benefit from it,” Ezekiel affirmed.
Lamenting over the hardships the removal of subsidy has caused for her, Agbaje Comfort, a retailer of soft drinks, said that the poor state of electricity in Akungba Akoko has resulted in high demand of fuel to power generators.
“By this time next week, the price of everything will increase. As for me, once I start buying the new price, everything will change,” she explained.
Businesses Crumble, Sellers In Dilemma
Akungba Residents standing to buy fuel at filling station. PC: Boluwatife Adedokun
Agboola Olanrewaju, who sells phone gadgets, claimed that the removal has affected his business as he is now using generator for every activity.
He said, “it has affected my business in terms of transportation and materials. Everything will soon be normal, this is our belief. For now, I can’t say this is what the government will do because it is a new administration in which no one can boast of their plans”.
Also businessman, Naru Tobi, blamed the citizens over the “complications of fuel scarcity and price increment”. He argued the government only made a declaration but the people have started increasing the price of fuel.
“It is we ourselves that is complicating issues for ourselves in the sense that the subsidy has not been implemented and people have increased the price of fuel.
“A filling station sold N300 in the morning yesterday and in the evening, they were selling at the rate of N500 when the subsidy has not been removed. Personal interest is our problem,” the computer operator said.
Tobi called on the the Federal Government to regulate the prices of petrol and check some filling stations that sell fuel with expensive charges.
“Fuel Subsidy is a Cancer in our Economy” – Expert weighs in
The managing editor of EnergyDay Nigeria Ltd, Oredola Adeola, affirmed that subsidies are costly and promotes non-inclusiveness and inefficient use of natural resources.
“The subsidy is costly, regressive and promoted non-inclusiveness and inefficient use of our natiral resources,” he said.
The economist noted that Nigeria will in the next few days see massive take off of over 150 new oil and gas projects across the upstream, midstream and downstream sectors from now up till 2027.
“The subsidy issue was a cancer that held the economic growth and development of the Nigerian nation hostage over decades of oil exploration and exploitation in the country.
The NNPC has taken advantage of this to promote its inefficiency thereby creating an industry that is not attractive to investors,” Adeola added.
