More than three years after President Bola Ahmed Tinubu declared that “fuel subsidy is gone”, fresh questions have emerged over whether the subsidy regime truly ended or simply took a different form through the financial operations of the Nigerian National Petroleum Company Limited (NNPCL).
The debate was reignited by the Chairman of the Alliance for Economic Research and Ethics Ltd/GTE and former President of the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA), Dele Oye, who argued that the Federal Government’s ₦17.512 trillion receivable recorded by NNPCL represents an “implicit fuel subsidy” rather than the complete elimination of the subsidy regime.
According to Oye, the ₦17.512 trillion is not a direct subsidy payment but a receivable owed to NNPCL by the Federation. The figure comprises about ₦8.672 trillion classified as “energy security costs” and ₦8.840 trillion recorded as other receivables, including advances and expenditure incurred on behalf of the government. He stressed that describing the entire amount as fuel subsidy would be inaccurate, but maintained that a significant portion reflects the government’s decision to absorb part of the cost of imported petrol instead of passing the full cost on to consumers.
Oye based his position on NNPCL’s 2024 audited financial statements, arguing that exchange rate losses and other import-related costs were transferred to the Federation under the “energy security” framework. He noted that the World Bank had similarly described the arrangement as an implicit petrol subsidy, adding that the practice reportedly ended in October 2024 when NNPCL began applying the official exchange rate and stopped recording foreign exchange differential losses.
The economist also raised legal concerns over the continued recovery of these costs under the Petroleum Industry Act (PIA), arguing that greater transparency is needed to determine whether all deductions from petroleum revenues were properly authorised. He warned that the deductions reduce the amount ultimately shared among the Federal Government, states and local governments through the Federation Account Allocation Committee (FAAC), potentially affecting funding for healthcare, education, infrastructure and other public services.
To improve transparency, Oye called for an independent forensic audit of all energy security costs and NNPCL receivables. He also urged the Federal Ministry of Finance, the Office of the Accountant-General of the Federation and NNPCL to reconcile all outstanding claims, disclose the legal basis for every deduction and ensure that any future fuel price support is subjected to explicit legislative approval rather than operating through off-budget arrangements.
