The All Progressives Congress Presidential Campaign Council has asked the presidential candidate of the African Democratic Congress, Atiku Abubakar, to explain the legal and fiscal basis of his proposed production subsidy for locally refined petrol. In a statement issued on Sunday, the council’s spokesman, Dele Alake, said Atiku’s proposal raised important legal, fiscal and practical questions that needed to be answered. Atiku had called on President Bola Tinubu to reduce petrol and diesel prices and proposed a production subsidy for locally refined petroleum products as a way of lowering pump prices.
Alake cited Section 205(1) of the Petroleum Industry Act 2021, which provides that wholesale and retail prices of petroleum products shall be based on unrestricted free-market pricing conditions. The Nigerian Midstream and Downstream Petroleum Regulatory Authority also said on Saturday that it does not fix petrol pump prices or issue administrative pricing templates, except where statutory conditions for intervention are met. The regulator said no market failure had been declared.
The APC-PCC spokesman asked Atiku to explain whether a refinery receiving the proposed subsidy would be required to sell petrol at a prescribed price. He also challenged Atiku to disclose the cost of the proposal and how it would be funded. The APC-PCC said Atiku had previously suggested that the intervention could take the form of preferentially priced crude for domestic refineries, arguing that any discount would reduce the value accruing to the Federation and, consequently, revenue available to the federal, state and local governments.
According to the APC-PCC, based on publicly reported refinery throughput and domestic petrol-supply figures, the cost of the new subsidy could run as high as N17 or N21 trillion annually. The council said Nigerians deserved to know the proposed subsidy rate, the annual spending ceiling, the volume of crude or petrol to be covered, the source of funding, and the mechanism guaranteeing lower pump prices.
Alake also questioned Atiku’s current position in relation to his previous support for downstream deregulation. He recalled that Atiku, while speaking at the Lagos Business School in November 2022, described the petrol subsidy system as fraudulent and pledged to complete its removal. However, in an August 25, 2026 post on X, Atiku said, “I will restore it!”
The APC-PCC contrasted Atiku’s proposal with the Tinubu administration’s focus on compressed natural gas and electric mass transit as alternatives aimed at reducing transportation costs. It said more than 120,000 vehicles had been converted to CNG, while programmes involving CNG and electric buses had reduced fares on some routes.
The council criticised Atiku’s proposal, saying it would enrich smugglers in particular. The APC-PCC acknowledged the pressure caused by higher petrol prices and said the Tinubu administration would continue to implement policies to support Nigerians.
Key points
- Atiku Abubakar's proposed production subsidy for locally refined petrol raises important legal, fiscal and practical questions.
- The cost of the new subsidy could run as high as N17 or N21 trillion annually.
- Atiku's proposal contradicts his previous support for downstream deregulation.
