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How Buhari Spent N8trn On ‘non-existent’ Petrol Subsidies



Before he won the 2015 presidential election, President Muhammadu Buhari led the opposition party, the All Progressive Congress (APC) in grand opposition to the removal of petrol subsidies.


President Buhari’s contention then was that there was no subsidy on petrol and that the government then under President Goodluck Jonathan was corrupt and was looking for ways to fraudulently enrich themselves at the expense of the Nigerian masses.


Eight years down the line and with just days before the end of his two terms in government, President Buhari is leaving the country with the highest amount spent on subsidizing petrol in Nigeria’s history.

According to oil and gas industry reports conducted by the Nigeria Extractive Industries Transparency Initiative (NEITI), the cost of petrol subsidy from 2015 to 2020 was N1.99 trillion.

Also reports by the Nigerian National Petroleum Corporation (NNPC) to the Federation Accounts Allocation Committee (FAAC), showed that petrol subsidy cost N1.57 trillion in 2021 alone and another N1.27 trillion from January to May 2022. The government has a budget of N3 trillion to cover petrol subsidy costs from June 2022 to June 2023.

An aggregation of the entire costs showed that under President Buhari the government would have spent N7.83 trillion on petrol subsidies.

Refineries remain moribund despite promises

In 2015, while Nigeria’s four refineries located in Port Harcourt, Warri and Kaduna operated below full capacity, they produced about six million litres of petrol daily for local consumption with President Buhari through the then Minister of State Petroleum Resources, Dr. Ibe Kachikwu assuring Nigerians that the refineries would return to full capacity by the end of that year. It never happened.

In 2017, the refineries were partially shut down for maintenance but two years later in 2019 with no headway, the refineries were completely grounded.

The President leaves in about three week’s time with the refineries still under rehabilitation and badly mismanaged. In 2021, helped by loans from the African Development Bank, NNPC announced that it would completely overhaul the Port Harcourt refinery at the cost of $1.5 billion. The refineries in Warri and Kaduna are also under-going similar process.

Expert speaks

Speaking to Saturday Vanguard, oil and gas governance expert, Mr. Henry Adigun said by his failure to resolve the petrol subsidy issues in eight years, President Buhari is leaving the situation worse than he met it.

Mr. Adigun said the politics and emotion around the issue have pushed the country into huge debt burden, adding President Buhari lacked an understanding of how big the issue was and how it could be tackled.

According to him, “The first thing is you cannot manage properly what you do not understand. Most times our politicians talk from emotion and lack of fact. At times they do not take professional advice and would let you know how long they have been in government.

“The man didn’t believe there was a subsidy and they all assumed it was corruption but when they came in and it stared them in the face then they learned and when they learned they now had to make harsh decisions. Buhari made one in 2016 when he raised (pump price) from N87 to N145 but he didn’t sustain. That point in time was the time to allow it to go once and for all but he capped it.

“By capping it and not providing enough foreign exchange for other importers, but allowed only NNPC to become the sole importer of the product in the country, they made the situation worse. That led to the problem they are having now.

“What they have done in the last eight years is to make it worse for the country, make it worse for the incoming administration. They have ballooned the cost and the volume. They failed because they never understood the problem and they made it political”.

He explained that NNPC became the sole importer of petrol due to economic reason, stressing that the difference the exchange rate approved for the NNPC compared to the other importers made impracticable for the others to import and remain profitable.

Adigun therefore urged the incoming administration to settle first settle down and understand the problem before taking a decision on the petrol subsidy challenge.

He noted that the government should eventually hands off any role in the downstream sector and allow the private sector run for the growth and economic development of the country.

The cash the private sector has can bail Nigeria out but the private sector will not invest in area where they cannot get good returns. Look around you in Abuja and Lagos, you will see everybody investing real estate or fintech; that is because it is where they can get good returns. It is not the business of the government to build or rehabilitate refineries”, he added.

He advocated phased removal of subsidy rather than having it in one swoop, stressing that in the past two years government has increased electricity tariff several times thereby eliminating the subsidy on power.

“Let’s have something like a three months phased removal, because it will become a political issue with labour unions opposed to it”, he stated, warning that the new government would struggle to fund its operations except it resorts to huge borrowing policy like Buhari has done.

TABLE – Petrol
Subsidy under Buhari
2015 ——————— N316.70 bn
2016———————- N99.00bn
2017 ——————— N141.63 bn
2018 ——————— N722.30 bn
2019 ——————— N578.07 bn
2020 ——————— N133.73bn
2021 —————— N1.573trn


Breaking news: Minimum Wage: Labour rejects FG’s N54,000 offer



The organised labour has rejected the Federal Government N54,000 new minimum wage proposal.


According to reliable source, the meeting on the ongoing negotiations on new minimum wage has been adjourned till Wednesday after the organised labour.


Media report has it that the Federal Government upped its offer from its earlier proposed N48,000 to N54,000.

Tuesday’s meeting came as a result of the walkout staged by members of the organised labour following the proposal of N48,000 as minimum wage by the Federal Government during last week’s meeting.

During that meeting, the OPS had also proposed N54,000 while labour insisted on its N615,000 living wage demand.

Our correspondent who spoke to sources who attended the follow-up meeting on Tuesday learnt that the Federal Government upped its offer from N48,000 to N54,000.

“Well, during the meeting, the government increased its offer from N48,000 to N54,000. However, labour rejected that offer and the meeting has been adjourned till Wednesday,” a source who asked not to be named said.

When asked if the government’s side was showing any sign of seriousness, the labour leader said, “No seriousness at all. Even state governors did not show up. Those who represented them, like Bauchi and Niger states, did not have the mandates to speak on their behalf.

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EFCC bars dollar transactions, orders embassies to charge in naira



The Economic and Financial Crimes Commission has barred foreign missions based in Nigeria from transacting in foreign currencies and mandated them to use Naira in their financial businesses.


The EFCC has also mandated Nigerian foreign missions domiciled abroad to accept Naira in their financial businesses.


The anti-graft agency said the move is to tackle the dollarisation of the Nigerian economy and the degradation of the naira

The Commission, therefore, asked the government to stop foreign missions in Nigeria from charging visa and other consular services in foreign denominations.

The EFCC gave the advisory in a letter to the Minister of Foreign Affairs, Amb. Yusuf Tuggar, for onward transmission to all foreign missions in the country.

In the letter, the EFCC said it issued the advisory because the practice of paying for consular services in dollars was in conflict with extant laws and financial regulations in Nigeria.

In a letter dated April 5, 2024, which was addressed to the Minister of Foreign Affairs, Ambassador Yusuf Tuggar, titled: “EFCC Advisory to Foreign Missions against Invoicing in US Dollar,” the EFCC Chairman, Ola Olukoyede expressed dismay over the invoicing of consular services in Nigeria by foreign missions in dollars.

The EFCC cited Section 20(1) of the Central Bank of Nigeria Act, 2007, which makes currencies issued by the apex bank the only legal tender in Nigeria.

The letter read, “I present to you the compliments of the Economic and Financial Crimes Commission, and wish to notify you about the commission’s observation, with dismay, regarding the unhealthy practice by some foreign missions to invoice consular services to Nigerians and other foreign nationals in the country in United States dollar ($).

“It states that ‘the currency notes issued by the Bank shall be the legal tender in Nigeria on their face value for the payment of any amount’.

“This presupposes that any transaction in currencies other than the naira anywhere in Nigeria contravenes the law and is, therefore, illegal.”

The commission further stated that the rejection of the naira for consular services in Nigeria by certain missions, along with non-compliance with foreign exchange regulations in determining service costs, is not just unlawful but also undermines the nation’s sovereignty embodied in its official currency.

The letter continues: “This trend can no longer be tolerated, especially in a volatile economic environment where the country’s macroeconomic policies are constantly under attack by all manner of state and non-state actors.

“In light of the above, you may wish to convey the commission’s displeasure to all missions in Nigeria and restate Nigeria’s desire for their operations not to conflict with extant laws and regulations in the country.”

Diplomatic sources said yesterday, May 10, that some embassies were wondering whether the EFCC’s advisory represented the position of the Federal Government.

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