APC-PCC questions Atiku’s proposed petrol subsidy, puts cost at N21trn

Chinedum Ukaegbu

All Progressives Congress Presidential Campaign Council (APC-PCC) has questioned former Vice President Atiku Abubakar’s proposed petrol production subsidy, putting the potential annual cost of the intervention at between N17 trillion and N21 trillion and demanding details of its legal, fiscal and operational framework.

The APC-PCC, in a statement issued on Sunday by its spokesman, Dele Alake, said Atiku’s proposal raised questions about how the intervention would operate under the Petroleum Industry Act (PIA) 2021, how much it would cost the government and how consumers would be guaranteed lower pump prices.

Atiku had reiterated his proposal for a production subsidy for locally refined petrol at a press conference in Abuja on Friday, saying the measure would help reduce pump prices.

He also called on President Bola Tinubu to reduce the prices of petrol and diesel.

The APC-PCC said Section 205(1) of the PIA provides that wholesale and retail prices of petroleum products should be based on unrestricted free-market conditions.

This position was also reflected in a recent clarification by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which said it does not fix petrol pump prices or issue administrative pricing templates.

The regulator said government intervention in pricing is subject to the conditions stipulated by the PIA, including circumstances involving a formally established market failure.

The APC-PCC therefore asked Atiku to clarify whether refineries benefiting from his proposed subsidy would be required to sell petrol at a prescribed price.

It said that if the answer was yes, Atiku should identify the legal framework that would allow the government to impose such a condition and explain how it would operate alongside the PIA.

If the answer was no, the council said Atiku should explain how government support to refiners would guarantee lower prices for consumers at filling stations.

“Without an enforceable mechanism, refiners could receive the benefit while consumers continued to pay market prices,” the council said.

The APC-PCC also challenged Atiku to disclose the estimated cost of the proposed intervention and explain how it would be financed.

According to the council, Atiku’s earlier position suggested that the intervention could involve supplying crude oil to domestic refineries at preferential prices. It argued that any discount on crude could reduce the value accruing to the Federation and consequently affect revenues available to the federal, state and local governments.

The council estimated that the proposed subsidy could cost between N17 trillion and N21 trillion annually, depending on the subsidy rate, volume covered and whether the intervention applied to the entire crude barrel or only to petrol sold domestically.

The APC-PCC said Atiku should provide details on the proposed subsidy rate, annual spending ceiling, volume of crude or petrol to be covered, funding source, mechanism for guaranteeing lower pump prices, safeguards against diversion and smuggling, and whether amendments to the PIA would be required.

It further argued that an appropriation by the National Assembly, while capable of authorising expenditure, would not by itself resolve regulatory questions arising under the PIA.

The council also questioned what it described as a change in Atiku’s position on petrol subsidy.

According to the statement, Atiku had, in November 2022, while speaking at Lagos Business School, described the petrol subsidy system as fraudulent and pledged to complete its removal.

The APC-PCC also cited Atiku’s August 25, 2026, statement on X in which he said, “I will restore it!”

The council said Atiku should explain how his proposed production subsidy differs from the previous subsidy regime and how it would prevent problems such as diversion, smuggling and fiscal losses.

The APC-PCC further linked the debate to Nigeria’s broader downstream petroleum reforms, noting that deregulation of some petroleum products began during the administration of former President Olusegun Obasanjo, when Atiku served as Vice President.

The council said the Petroleum Industry Act represented the outcome of a lengthy reform process and challenged Atiku to explain how his proposal would fit into the existing legal and regulatory framework.

Meanwhile, the Tinubu administration has continued to promote compressed natural gas (CNG) and electric vehicles as alternatives aimed at reducing transportation costs.

President Tinubu said on September 19 that more than 120,000 vehicles had been converted to CNG over the past three years, while the country had more than 400 certified conversion centres and over 90 CNG refuelling stations.

The President also said commuters were already benefiting from lower fares on some CNG and electric transport routes. He cited fares of between N50 and N100 on some routes in Borno State, compared with commercial fares of N300 to N600, while passengers on the Suleja-Abuja route in Niger State were paying N550 compared with about N800 previously.

Tinubu has also directed states to scale up the National Affordable CNG Transit Programme ahead of October 1, with the stated objective of delivering measurable reductions in transportation costs.

The APC-PCC acknowledged the pressure caused by rising petrol prices but maintained that interventions in the downstream petroleum sector should be lawful, transparent, properly costed and capable of producing measurable benefits for consumers.

The council consequently called on Atiku to publish a detailed policy document setting out the legal, financial and operational framework of his proposed production subsidy.

It said that until such details are provided, the proposal remained, in its view, an uncosted policy promise without a clearly identified legal or operational framework.