Fuel queues resurface in Nigeria amid Tinubu’s ‘no more subsidy’ declaration

FUEL queues have resurfaced in major cities across the country, following the declaration by President Bola Ahmed Tinubu that there will be no more subsidy on petrol.

Already, fuel marketers are riding on the uncertainty created by the announcement and had arbitrarily hiked the pump price of petrol.

Some marketers have shut down their retail outlets, hoarding the product, which has created long queues of vehicles at filling stations.

The ICIR reports that commercial buses were scarce on the roads in major cities today as a consequence of fuel scarcity. Where available, the bus operators jacked up fares as high as 100-300 per cent. Many commuters who could not afford the fares were seen trekking long distances.

In Lagos, many filling stations were seen shut. The NNPC and Mobil filling stations on Bariga Road in the Lagos metropolis, for example, were not dispensing Tuesday. The NNPC station sold fuel in the morning of Monday, May 29, at N185 per litre, but by the afternoon after Tinubu’s speech had spread, the station had suddenly locked its gates.

On the Ikorodu Road stretch between the Fadeyi and Palm Grove axis, the Total filling station was seen dispensing fuel. The other NNPC and Conoil filling stations in the area closed their gates.

An independent filling station on Sipeolu Street, Palm Grove Road, was also not selling.

Motorists at an NNPCLtd retail outlet in Dei-Dei, a suburb of the Federal Capital Territory, struggling to buy petrol
Motorists at an NNPCLtd retail outlet in Dei-Dei, a suburb of the Federal Capital Territory, struggling to buy petrol

In Port-Harcourt, Rivers state, several motorists were stranded on Tuesday, May 30, as most fuel stations in the city failed to operate.

A tricycle driver, Samson Tonye, who operates along the Okuru-Abuluoma axis, shared his experience with The ICIR.

“Someone told me that he bought fuel for N500 yesterday in a fuel station. I drove from here to Amadi; no fuel station is open,” he said.

It is a similar situation in Ogun state, as residents confirmed that a surge was recorded in transport costs on Tuesday.

“I usually pay N150 to N200 for transportation to work, but today, I spent N300. They said there is no fuel,” a resident Funke Abiodun told The ICIR.

While some fuel stations were also closed in the Federal Capital Territory (FCT), a number of fuel stations remained open. However, queues stretched for hundreds of metres away from the pumps.

Consumers in long queues at NIPCO filling station in Kubwa.
Consumers in long queues at NIPCO filling station in Kubwa, May 2023

A motorist who spoke to The ICIR at the NNPCLtd. fuel station in Guzape said the queues resulted from panic buying, as residents were anticipating a shortage of petrol following Tinubu’s declaration.

“There is fuel, but people are panic-buying. They said they would remove the subsidy, but they haven’t removed it. Yet people have started buying in a rush instead of waiting for the increase,” he said.

The development is making motorists turn to the black market, where vendors sell as high as N350 per litre in the FCT, against the average N194 for which fuel is usually sold.

A Total Energy retail outlet shutdown as a result of the pronouncement
A Total Energy retail outlet shutdown as a result of the pronouncement

Tonye told The ICIR that he eventually purchased a litre of fuel for N600 in Port Harcourt.

“I just bought fuel now at the black market at N600 for a litre. People were even rushing it, and I could only get two litres,” he said.

While delivering his inauguration speech after his swearing-in as Nigeria’s president on Monday, Tinubu said the country could no longer subsidise fuel prices due to lean resources.

“Subsidy can no longer justify its ever-increasing costs in the wake of drying resources. We shall instead re-channel the funds into better investment in public infrastructure, education, health care and jobs that will materially improve the lives of millions,” Tinubu stated.

Fuel subsidy has consumed a substantial part of Nigeria’s revenue and has been identified as a cause of declining financial resources by the past administration.

According to data from the Nigerian National Petroleum Company Limited (NNPCLtd), N4.39 trillion ($9.7 billion) was spent on petrol subsidy in 2022.

Efforts had been made to remove or reduce fuel subsidy, but such efforts had been met with resistance by Nigerians.

International bodies like the International Monetary Fund (IMF) and the World Bank had urged the Nigerian government many times to remove the subsidy on petrol, arguing it was holding down infrastructural development.

Many Nigerian financial experts and stakeholders in the oil and gas sector had also pointed out what they called the numerous corrupt practices in subsidy payments, insisting the government should stop the payments and channel the gains into developmental projects.

What experts are saying

While some analysts’ voices have been lauding the Tinubu administration for what they described as its courage in finally removing the subsidy, they are blaming it for the poor communication of its decision to the masses.

“The marketers are being ahead of the narrative as marketers. The marketers are tactically following the market since no one has told them what the price will be after they finish their present stock. It also shows a case of poor quality communication and lack of clarity of policy,” an oil and gas governance expert Henry Ademola Adigun told The ICIR.






     

     

    “That is the reason why we said that announcement should not have been made at the time it was made. The announcement should have been done with tact after meeting with stakeholders. The manner of the announcement brought uncertainty into the polity and the market is reacting to it,” Adigun added.

    The president of the Petroleum Retail Outlets Owners Association of Nigeria (PETROAN), Prince Gilly-Harris, told The ICIR that effective stakeholder engagements needed to happen before the summarily removal of petrol subsidy.

    “The President himself campaigned on this subsidy removal. However, there is need for high-level consultation before this kind of announcement is made.

    “On our own as a group, we have been having high-level consultation on how to manage the opportunity cost of the subsidy removal when it is eventually thrown at us,” Gilly-Harry said.

    Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.

    Ijeoma Opara is a journalist with The ICIR. Reach her via [email protected] or @ije_le on Twitter.

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