The Nigerian Labour Congress (NLC) and civil society are, I believe, ready for the fight. This time, however, I would not be at the barricades. I believe that we have lost the battle, which is based on getting our share of the rentier state, because the Nigerian rentier state lost its battle for life under the Buhari presidency, when petroleum rent dried up as criminals overthrew rentier bureaucrats.
In his inaugural address on Monday, President Bola Tinubu announced the end of fuel subsidy as it would no longer be an item on the budget. On Wednesday, government announced a drastic rise in the prices of petrol from N185 to up to N557 a litre, depending on location. It was a shock to the nation and, immediately, labour was up in arms, demanding for a complete withdrawal of the new prices. The shock was due to expectations, on the basis of government announcements, that palliatives would be negotiated and offered to poor Nigerians who would be impacted negatively by the new prices expected to come into effect in July.
By jumping over the waiting period and announcing very high new prices, rather than talking in the more coy language of deregulating the sector and allowing market forces to dictate prices, the Tinubu administration is clearly signalling that it is going to war on the matter and would use overwhelming force – shock and awe – to defeat the opposition, which is virtually all Nigerians. We Nigerians believe that our covenant with the state is based on the ruling class corruptly ‘chopping’ our money, our patrimony, and we the people being compensated with the crumbs of cheap fuel. That is why we have always fought the state with determination every time it has threatened to take away our crumbs in the form of the cancellation of fuel subsidy. The Nigerian Labour Congress (NLC) and civil society are, I believe, ready for the fight. This time, however, I would not be at the barricades. I believe that we have lost the battle, which is based on getting our share of the rentier state, because the Nigerian rentier state lost its battle for life under the Buhari presidency, when petroleum rent dried up as criminals overthrew rentier bureaucrats.
Going down memory lane, I still have fond memories of our last battle to save fuel subsidy in 2012. In Abuja, we decided to call the bluff of the Jonathan administration by establishing BLUF – Building Leverage and Unity on Fuel Subsidy Struggle. We were incensed by the decision of the Jonathan administration to cancel fuel subsidy because of its implications for extremely high costs for transport, food and other essentials. It was and remains a policy decision aimed at deepening poverty and the suffering of Nigerians.
This time, the character of the state has changed significantly. Most petroleum produced in the country is simply stolen by cabals in charge of state administration and security. The Nigerian revenue flows have dried up and 96% of what comes in is used to pay for debt servicing. This means that almost the totality of the N400 billion spent on fuel subsidy each month is borrowed. Allocations for health, education and social services have been largely abandoned to pay for fuel subsidy.
We pointed out that the price of petroleum products had been adjusted eighteen times in the 26 years since the military administration of General Babangida broke the mould by raising the pump price of petrol from 3.15 kobo per litre to 20 kobo per litre in April 1985. Throughout this period, while there have been regular increases in fuel prices, no government has succeeded in completely removing fuel subsidy. The Jonathan administration, we contended, would also fail because Nigerians will struggle against it and win. We won. The result is that a cabal or regime insiders and marketers have stolen trillions of naira from our national treasury and, as former Minister Ngozi Okonjo-Iweala explained, most of the subsidy we have been paying for is not even on real fuel brought into the country; it has simply being the looting of the treasury.
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Part of what made us angry in 2023 was the decision of President Jonathan to stop consultations with stakeholders, take a unilateral decision on the issue, and then establish a negotiation body after implementing his unilateral decision. We believed that was very disrespectful to Nigerians who were very passionate about the issue. I hope that the Tinubu administration would be willing to negotiate with stakeholders. The key point in 2012 was that we were able to contest the arguments of the Jonathan administration that the fuel subsidy was unsustainable, arguing that petroleum revenue inflows were sufficient to pay for the subsidy, if corruption was controlled.
This time, the character of the state has changed significantly. Most petroleum produced in the country is simply stolen by cabals in charge of state administration and security. The Nigerian revenue flows have dried up and 96% of what comes in is used to pay for debt servicing. This means that almost the totality of the N400 billion spent on fuel subsidy each month is borrowed. Allocations for health, education and social services have been largely abandoned to pay for fuel subsidy. As at the end of 2022, Nigeria’s national debt was N25 trillion or $103 billion. With this unsustainable debt, we are mortgaging the future of our children and grandchildren. If we are foolish enough to continue along that path, the creditors are also reading the tea leaves and would soon draw the line, being aware that we no longer have the capacity to repay newer debts. This means we will soon reach where Sri Lanka got to by simply not having the ability to even borrow the cash to pay subsidy any more.
My final frustration is on the consistent recommendation we have made over the decades that the Nigerian state should fix our four refineries to reduce or even eliminate our dependence on imported fuel. One person who once agreed completely with us was a certain Muhammadu Buhari. In 2025, he became president, and was also minister of petroleum for eight years. He repeatedly gave contracts to fix the refineries. None of them is working.
The Nigerian state is broken and can no longer generate the rent to pay for what we and our four neighbouring countries have been enjoying in the form of very cheap petrol. Niger and Cameroon are petroleum exporting countries that deliberately set their petrol prices at five times the cost of ours, to encourage the smuggling in of Nigerian petrol for their consumers. We are the big brother who has subsidised their transport and electricity systems for fifty years, but unfortunately we are broke today and cannot continue. The NLC and civil society has to catch up in terms of its analysis of the Nigerian state. Does it make sense to borrow to pay subsidy and threaten our collective future with unpayable debt? Is cheap petrol more important to Nigerian citizens than health, education and social services, which are being abandoned for a tunnel focus on cheap petrol? Should NLC win the battle to save the fuel subsidy battle, what would be the implications of that “victory” for hastening the bankruptcy of the Nigerian state? These are the questions that led me to withdraw from my fourty-five-year battle to sustain fuel subsidy in our beloved country.
My final frustration is on the consistent recommendation we have made over the decades that the Nigerian state should fix our four refineries to reduce or even eliminate our dependence on imported fuel. One person who once agreed completely with us was a certain Muhammadu Buhari. In 2025, he became president, and was also minister of petroleum for eight years. He repeatedly gave contracts to fix the refineries. None of them is working. He owes Nigerians an explanation. Was the money once again simply stolen under his watch?
A professor of Political Science and development consultant/expert, Jibrin Ibrahim is a Senior Fellow of the Centre for Democracy and Development, and Chair of the Editorial Board of PREMIUM TIMES.
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