SDP Chairman Calls for Review of Fuel Subsidy Removal and Electricity Tariff Hike in Nigeria

SDP Chairman Shehu Gabam urges President Bola Tinubu to review fuel subsidy removal and electricity tariff increase, citing potential for anarchy. Gabam recommends privatizing refineries and removing NNPC from downstream sector to address scarcity and high prices.

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Quadri Adejumo
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SDP Chairman Calls for Review of Fuel Subsidy Removal and Electricity Tariff Hike in Nigeria

SDP Chairman Calls for Review of Fuel Subsidy Removal and Electricity Tariff Hike in Nigeria

Shehu Gabam, the National Chairman of the Social Democratic Party (SDP), has urged President Bola Tinubu to review the recent removal of fuel subsidies and the increase in electricity tariffs in Nigeria. Gabam made the appeal on Thursday while hosting a three-member caucus of the opposition party from the Nasarawa State House of Assembly at the national party secretariat in Abuja.

Why this matters: The removal of fuel subsidies and increase in electricity tariffs have far-reaching implications for the Nigerian economy and citizens, potentially exacerbating poverty and social unrest. If left unchecked, these policies could lead to widespread protests, economic instability, and a decline in living standards for millions of Nigerians.

The SDP Chairman cited the potential for these policies to exacerbate poverty levels and possibly lead to anarchy in the country. "The increase in the price of premium motor spirit occasioned by the removal of fuel subsidy and the recent increment in electricity tariff are capable of throwing thenationin anarchy,"Gabam warned. He also commended Hon. Solomon AKwashiki, a member of the delegation, for raising the alarm about the epileptic power supply in Nasarawa State and challenged the National Assembly to speak out on the hardships faced by Nigerians as a result of these policy changes.

The removal of fuel subsidies on Inauguration Day triggered a significant price increase, with petrol prices rising from N187 per liter to between N568 and N650 per liter. However, scarcity remains a cyclical issue, leading to long queues at filling stations and prices skyrocketing to as high as N1,300 per liter at independent stations and N2,000 per liter on the black market. Nigeria, Africa's largest oil producer, relies entirely on petrol imports, with an import bill of N5.2 trillion in 2022.

The country's four public refineries, under the control of the Nigerian National Petroleum Corporation (NNPC), have been non-functional for decades, despite having a combined nameplate capacity of 445,000 barrels per day. The official explanation that removing petrol subsidies would ensure wide availability of the product has fallen flat, as scarcity persists. The scarcity and high prices have led to tragic consequences, with a recent incident involving a lawless security agent shooting dead a young man in a rowdy queue for petrol in Lagos on Wednesday night.

To address these challenges, Gabam has recommended that President Tinubu remove the NNPC from the downstream sector, allowing competition to thrive. He also suggested privatizing the refineries and removing the NNPC's imprint from retailing. These measures, he argued, would bring several benefits, including the return of international and domestic investors to the sector, innovation, job creation, increased tax revenue, and a higher GDP.

The fuel subsidy issue in Nigeria has a long and complex history. In 2011, the Goodluck Jonathan administration paid N2.57 trillion on phantom petrol subsidies. Oil theft, another major challenge, reduced from 700,000 barrels per day under Muhammadu Buhari's presidency (2015-2019) to 400,000 barrels per day, which still remains the highest globally. Nigeria loses more than 4 million in income daily as a result of oil theft, despite having an OPEC quota of 1.7 million barrels per day.

As President Tinubu grapples with the complexities of the fuel subsidy removal and its impact on the Nigerian economy and society, the words of SDP Chairman Shehu Gabam serve as a sobering warning of the potential consequences of these policies on the lives of ordinary citizens. The nation watches closely while the Tinubu administration confronts this critical issue, hoping for a resolution that will bring relief, stability, and prosperity to Africa's most populous country.

Key Takeaways

  • SDP Chairman Shehu Gabam urges President Tinubu to review fuel subsidy removal and electricity tariff hike.
  • Fuel prices rose from N187 to N568-650 per liter, causing scarcity and long queues.
  • Nigeria relies on petrol imports, with an import bill of N5.2 trillion in 2022.
  • Gabam suggests privatizing refineries and removing NNPC from downstream sector to address challenges.
  • Fuel subsidy removal and oil theft cost Nigeria millions daily, exacerbating poverty and social unrest.