The government has said that it will not continue to bear the U.S.$300 million monthly subsidy burden on petroleum products. The Group Managing Director of the Nigerian National Petroleum Corporation, Mele Kyari said at the fifth edition of the special ministerial briefings coordinated by the presidential communications team. Nigeria deregulated its downstream oil sector a year ago after the Covid-19 pandemic triggered a collapse in the global price of oil, its main export.
That ended a system of fuel subsidies that had helped keep the lid on simmering social unrest for decades. But the NNPC picked up the tab after the government made it the country’s sole petrol importer. Kyari said that since the NNPC could no longer bear the cost, sooner or later Nigerians would have to pay the actual cost for the commodity. Meanwhile, according to the Minister of State of Petroleum Resources, Timipre Sylva, the parliament may pass the long-delayed Petroleum Industry Bill in April 2021.
The bill will change the structure of state oil company NNPC, amend oil and gas taxes and revenue-sharing and create new regulatory bodies, to make Nigeria’s oil sector more dynamic and efficient. Some Nigerians have called for the removal of the subsidy, to enable the government to invest the funds into other developmental projects. Others have however condemned calls for its removal, citing it as perhaps one of the most significant “benefits” the masses enjoy from the government.