Abubakar would restore petrol subsidy, phase it out later: Spokesman

Paul Ibe, a spokesperson for Nigeria's former Vice President Atiku Abubakar, has outlined a plan for a potential future administration to reinstate the controversial petrol subsidy. Speaking on AIT, Ibe stated that if Abubakar is elected president in 2027, his government would restore the subsidy but with a strategy to gradually phase it out once the economy shows signs of recovery.

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What he's simply saying is that the subsidy that he is advocating will be tied to the barrel, the crude oil barrel. This is perhaps the only thing that we have in so much abundance that Nigerians have not yet benefited from.

Ibe emphasized that this proposed subsidy would differ significantly from previous regimes. The support would be directly tied to Nigeria's crude oil production and its capacity for domestic refining. The core idea is to supply crude oil to local refiners at a discounted rate. This would enable them to produce petrol and diesel at lower costs, ultimately translating into reduced pump prices for consumers and stimulating economic activity.

"What he's simply saying is that the subsidy that he is advocating will be tied to the barrel, the crude oil barrel," Ibe explained. "This is perhaps the only thing that we have in so much abundance that Nigerians have not yet benefited from." He added that an independent committee would be established to determine the appropriate discounted price for crude oil supplied to refiners, considering prevailing market conditions.

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The crude oil will be sold at a discounted price, subsidised to refiners, and that will enable refiners to be able to produce fuel and diesel at a cheap cost. And when they produce cheaply, they will sell at the real pump price.

While acknowledging the deregulation of the downstream petroleum sector, Ibe suggested that the government could still implement price monitoring mechanisms to ensure refiners and marketers adhere to the policy's objectives. He stressed that the intervention would be temporary, designed as a catalyst to "jumpstart this economy" and boost productivity.

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It is not something that is… It is for a time, and it is essentially to ensure that we jumpstart this economy.

Furthermore, Ibe used the opportunity to criticize the current administration's economic policies, particularly the swift removal of the petrol subsidy. He likened the approach to a surgeon performing multiple major operations without allowing the patient time to recover, arguing that the subsidy removal was done abruptly, without adequate planning, cabinet consultation, or the implementation of necessary palliatives.

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No surgeon, no doctor would carry out two or more serious major surgeries, one after the other. They would do one, allow the patient to recuperate, and then undertake the second, or the third. But what has this administration done? The issue of subsidy, flippant. No cabinet. No advisers. Just in the heat of the moment, it has been removed. No shock absorbers. Nothing. No palliatives. Absolutely nothing.