Fuel subsidy in Nigeria

Fuel subsidy is a controversial issue in Nigeria. It is a mechanism whereby the government of Nigeria sells petrol to its citizens at a lower price than the market price by absorbing the difference in the cost. The fuel subsidy is aimed at reducing the cost of living for Nigerian citizens and to make petrol more affordable. 

The fuel subsidy in Nigeria is a highly contentious topic that has been debated since the 1970s when it was first introduced. Many commentators are of the view that the fuel subsidy is inefficient, as it mainly benefits those that can afford to buy fuel, ignoring the vulnerable and poorer sections of society. Additionally, some argue that the subsidy encourages waste and corruption and does little to support economic development in Nigeria. 

In July 2020, the Nigerian government proposed removing the fuel subsidy in order to save an estimated $5 billion annually. The proposed removal has faced strong opposition, with protests and strikes across the country. Critics of the proposal point out that removing the subsidy would lead to higher fuel prices, further disadvantaging the most vulnerable sections of society who rely heavily on petrol for their daily needs.