Oyedele
Fuel subsidy won’t return, minister insists, amid cost-of-living crisis
The Federal Government will not reintroduce fuel subsidy despite rising living costs following its removal, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has said.
Speaking on Tuesday in Paris, France, during a meeting between President Bola Tinubu and global investors, Oyedele stated that subsidies had previously caused economic “distortions.”
He added that petrol pricing would not be regulated, as the government trusts market forces to determine prices.
Since the subsidy was scrapped in May 2023, Nigeria has seen inflation surge to a 19-year high.
Headline inflation rose from 22.41% in May 2023 to 34.19% by June 2024, driven largely by rising fuel, food, and transport costs. By October 2024, food inflation had exceeded 39%.
The policy change, coupled with currency devaluation, pushed transportation costs up by nearly 300% and deepened poverty.
“We will not bring back fuel subsidy because it creates distortions for the economy, and we won’t introduce price control because we believe in the market… the situation in Iran presents new opportunities for us as the world looks to diversify sources of energy and invest in new markets,” Oyedele said.
Earlier, President Tinubu told investors that Nigeria had achieved improved foreign exchange stability following the removal of the subsidy “burden.”
According to a statement by his Special Assistant on Social Media, Dada Olusegun, Tinubu said, “Subsidy that was a burden to the entire country, was removed and ever since we have achieved FX stability.”
In a follow-up statement, Presidential Adviser on Information and Strategy, Bayo Onanuga, noted that the administration’s reform agenda focuses on eliminating economic distortions and strengthening macroeconomic stability.
He cited the government’s commitment to transparency and fiscal discipline.
Tinubu reaffirmed his dedication to sustaining reforms.
Oyedele pointed to an 11.2% GDP growth in dollar terms in 2025, reinforcing the goal of a $1 trillion economy by 2030.
He promised regular publication of quarterly financial reports.
Debt Management Office Director-General, Patience Oniha, assured investors of prudent debt management and sustainable borrowing.
The investor group included representatives from Citibank, Amundi, BlueCrest, Ninety One, Kirkoswald Capital, Principal Finisterre, PGIM, and Mesarete Capital.
President Tinubu, on a three-nation trip, said reforms aim to stabilise key indicators and create sustained growth.
He added that efforts are ongoing to deepen reforms, improve transparency in the oil sector, and implement a comprehensive security strategy, including police decentralisation and tackling terrorist financing.
“The focus remains on policy stability and diligent execution to ensure these strategic shifts translate into concrete benefits for all Nigerians,” Tinubu said.
Some investors praised the reform agenda and expressed confidence in Nigeria’s economic outlook.
Asked about his plans beyond 2027, Tinubu pledged to reinforce fiscal discipline, improve transparency, and maintain consistent policies.
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