Nigeria

Nigeria Fuel Subsidy Gulps $10bn in 2022


Published: Friday January 27, 2023
By: Oilfield Africa Review

The Nigeria National Petroleum Company, NNPC, spent 4.39 trillion naira ($9.7 billion) on petrol subsidy last year, latest data from the state-owned firm, as quoted by Reuters.

The government has blamed this for dwindling public finances.

NNPC did not remit funds to federal accounts last year, its data showed, leaving a hole in public finances at a time when the government has been warning that low revenues and large deficits left it unable to stimulate the economy.

Successive governments in Nigeria have tried and failed to remove or cut the subsidy, a politically sensitive issue in the country of 200 million people.

Nigeria imports nearly all its refined fuels because local refineries were shut due to years of neglect.

Oil production, which has started to recover, has been throttled by crude theft and pipeline vandalism, which means Nigeria is spending more on fuel imports than it is getting from crude oil production.

https://www.nogenergyweek.com

Finance minister Zainab Ahmed has said the country will keep its costly but popular petrol subsidy until mid-this year and set aside 3.36 trillion naira ($7.5 bln) to spend on it.

The current government of President Muhammadu Buhari said subsidy will go in June, but it is uncertain what will happen as the country expects a new regime at the helm of affairs as from May 29, following next month’s presidential election.

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