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On fuel price and inflation in Nigeria

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By Abraham Adekunle

Masses clamor for reduction in fuel prices, while FG to review minimum wage.

The aftermath of fuel subsidy removal in Nigeria resulted in the skyrocketing of fuel price across the country. As soon as President Tinubu made the announcement during his inauguration, marketers started hoarding the fuel in their possession in hopes of selling to the highest bidder. Although some state governments sent out task forces to force filling stations to sell at the normal prices, majority of stations in the country are already selling at three times the normal price.

There are speculations that the fuel subsidy is a fraudulent concept. Many are claiming that the funds are shared between a select few who live large on it. It is even quite confusing when one discovers that the government imports 100 percent of all fuels into the country. Who, then, do you pay the subsidy to when your agencies are the importers of the fuel? The Nigerian National Petroleum Company Limited (NNPCL) has also come out to say that the Federal Government owes it in billions.

Is the solution fuel price reduction or minimum wage review?

Now that the situation has developed and the masses are adapting to it, the Trade Union Congress (TUC) has asked the Federal Government to reserve the old price of fuel until the government reaches an agreement with the trade unions. TUC President, Comrade Festus Osifo, told newsmen that their demand is the decision of the congress’s national executive council, which was made after a long deliberation on fuel subsidy removal issues. The problem is not the unwillingness of the new president to retain the old price but the fact that the new budget does not make any provision for fuel subsidy payment.

According to Tinubu, the budget that Buhari signed before leaving office does not account for fuel subsidy. So, the concern has been whether reduction in price is the solution, if that is ever possible, or reviewing salaries of workers in tune with the increase in goods and services. Since the government has made it clear that subsidy payments cannot be reinstated, then the masses will have to cope with the current situation of increased costs.

Massive inflation underway in every sector of the country.

If fuel cannot be subsidized for all, the other option is to review workers’ salary to compensate for the rise. In 2022, Minister of Labour and Employment, Senator Chris Ngige, said that the Federal Government was on the verge of approving salary increase for all categories of public service workers in Nigeria. However, he did not state the specific percentage or amount being proposed as of the time. The reason given at that time was that it was meant to cushion the effects of inflation, increase in cost of living, increase in transportation, increase in housing cost, hike in electricity tariff and other utilities.

This was when fuel price still hovered at around N200 per liter. Presently, it has tripled in some areas to between N600 and N800. The increase will effect every sector of the economy, resulting in all-round inflation. Inflation occurs when there is increase in price of goods and services as a result of increase in the cost of production. The government will also make it permanent if salary is increased as this would spur every other entity in the country to hike prices.

Nigeria would have still experienced this under other presidential candidates.

During the campaign for the just-concluded 2023 general elections, other presidential candidates stated categorically that they would also remove fuel subsidy payments from the budget. In particular, the presidential candidates of the other two leading political parties, Peter Obi and Atiku Abubakar, clearly announced that if they were elected, they would make it a thing of the past. However, some people believe that their own candidates would have fared better because provisions would have been made to cushion the effect of the removal.


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AN-Toni
Editor
8 months ago

On fuel price and inflation in Nigeria.Masses clamor for reduction in fuel prices, while FG to review minimum wage.Express your point of view.

Iyanu12345ogg
Iyanu12345ogg
Member
8 months ago

It is imperative that the government takes urgent steps to address both issues and ensure that the masses are not unduly burdened by the current economic situation. This may require tough decisions and sacrifices (removal of fuel subsidy), but it is necessary if we are to build a more sustainable and prosperous future for all.

Last edited 8 months ago by Iyanu12345ogg
Abusi
Abusi
Member
8 months ago

Fuel price has gone up as a result of the subsidy removal. Inflation too is already lorking it’s horns at Nigeria. I hope we can come up with policies that will reduce the impact of this hard time we are in.

Tonerol10
Tonerol10
Member
8 months ago

On fuel price and inflation in Nigeria. The increment is too much, transportation is very high now. Everything is on the high side in this country. Masses are really suffering in Nigeria

Haykaylyon26
Member
8 months ago

on Nigerian inflation and fuel prices. The increase is excessive; shipping costs are now very high. In this nation, everything is on the expensive side. Massive misery exists in Nigeria.

Taiwoo
Taiwoo
Member
8 months ago

The loss of subsidies has resulted in an increase in fuel prices. Nigeria is already being bullied by inflation. I hope we can develop regulations that will lessen the effects of this challenging moment.

Kazeem1
Kazeem1
Member
8 months ago

Fuel prices have risen as a result of the loss of subsidies. Inflation is also wagging its tail at Nigeria where everything’s is cost . I hope we can devise ways to mitigate the effects of this difficult time

Adeolastan
Adeolastan
Member
8 months ago

The subsidy removal is a good one but the hike in fuel price and inflation in Nigeria is a bad one. The FG should set up control price for some goods and FG needs to increase the minimum wages of the workers for the betterment of everyone.

DimOla
DimOla
Member
8 months ago

The subsidy that has been remove will never be return. The best thing here is to increase workers salary. Imagin what is going on in the country. Some set of people known as the cabals are the one eating the subsidy.

SarahDiv
Member
8 months ago

The subsidy removal had come to stay and nothing can reverse it. The will prevent those set of people who are feeding fat on the pain of the nation from getting hold of the subsidy again. However, the hardship in the country has increase due to the subsidy removal, with the current inflation rate of the country couple with bad previous government policies. We should hopeful that over time there will be improvement.