The daily average fuel consumption in Nigeria has dropped by 18.5 million litres from 66.9 million litres pre-fuel subsidy to 48.4 after President Tinubu scrapped the expensive fuel subsidy program.
Reuters report the drop marks a 28% decline in the daily petrol consumption in the country according to data from the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA).
Reasons for the reduction in consumption figures
The slump in consumption figures can be attributed to the smuggling of petrol from Nigeria to neighbouring countries like Chad, Niger, Cameroon and Benin Republic.
TheTimes report the price of petrol in Niger Republic jumped from 450CFA during the petrol subsidy era to 800CFA after the removal of the fuel subsidy.
The Group Managing Director of NNPCL, Mr. Mele Kyari had earlier complained of the smuggling of Nigeria’s petrol to other neighbouring countries. He said there is no data on the total consumption in the country but what they know is the total number of trucks that leave the depots daily
Mr Kyari lamented in an interview that Nigeria’s fuel goes as far as Sudan in North Africa.
Nigeria has maintained a decade-long petrol subsidy to keep prices petrol prices low for its large population. In recent times, the funds spent on these subsidies have eaten deep into government revenues.
In 2022, the country spent around $10 billion on petrol subsidies- more than it spent on education, health, and social services combined. Nigeria’s former finance Minister earmarked N3.36 trillion on petrol subsidy for the first six months of 2023.
Various Presidents in the past have tried to remove the much-beleaguered petrol subsidy to no avail. However, in his inauguration speech, President Tinubu announced that there is no provision for fuel subsidy, then it is gone. This move led to an increase in the price of petrol across the country.