Fuel Price Increase

On the issue of this “ghost price limit hike”, Nigerians cannot be expected to trust this administration any longer. Therefore, the government must stop playing these childish games with the people’s lives and come up with an honest policy of full deregulation.


I am not a fan of government subsidising most commercial activities because it prevents such concerned sectors from operating optimally and it is usually abused. Furthermore, I believe that it is always more productive to put such money in the pockets of the people instead of the Swiss bank accounts of a few.

The fact that I find myself discussing a fuel price increase that was caused neither by subsidy removal, nor deregulation, nor a major increase in crude price, nor a devaluation of the naira makes me question the capability of the current Buhari/Osinbajo administration. Could it be true that the leadership lacks vision, has a parochial mindset and is allergic to honesty as is being alleged by some Nigerians?

Whatever this fuel price increase is called, the fact is that it should have been done on May 29, 2015 because there is nothing that we know now that was not known then. The appointment of Dr. Ibe Kachikwu (very qualified) has not brought any new or unique perspective to the challenge that was facing the nation in this area. Which, simply put, is that Nigeria does not have enough foreign exchange to meet its petrol import needs. If this had been done a year ago, Nigerians may have been saved from the pain and hardship of the past months and the economy would not have suffered the loss of millions of man hours as workers’ destinies were being destroyed on Kachikwu fuel queues.

We all admit that the problem was caused by factors beyond their control but the point is that till this moment the Federal Government has not taken one single right decision in tackling the problem. We also recognise the fact that President Muhammadu Buhari’s aversion for a price increase may not have helped the situation. However, these facts do not justify the wrong manner in which the matter has been handled till date. Since managing your boss is a basic skill in today’s work environment, If Dr. Kachikwu had believed that a price increase would resolve the situation, he could have threatened to resign or he could have gone on his knees and wept like a baby suffering from colic just to put pressure on the president. Instead, he gave the false impression that the problem would soon be resolved and shamelessly engaged in a naked dance of dishonesty and blame. The local refineries have started working he claimed; we are importing enough but it is being diverted to neighboring countries; we are only doing price modulation. Later he said the refineries need US$700 Million to be put in good shape and now we are not importing enough. All these games of self-deceit only erode the people’s confidence in the government.

…the fixing of price limits must be abolished immediately with NNPC operating only as a player and no longer as a regulator. Furthermore, the storage assets of NNPC must be constituted into a fully commercial venture offering its services to all players at market determined rates.


To compound matters, the Federal Government then decided to enforce the ban on portable generators (“I Better Pass my neighbour”) while insisting that generator owners must suffer the additional sorrow of bringing their heavy generating sets to the fuel station before it can be refilled. To think that this mindless decision was taken by an administration that has failed to improve the supply of electricity and has worsened the supply of fuel. Shame will not allow me to discuss their environmental and security concerns which are their justification for such parochial decisions.

Faced with the shortage of fuel, the Buhari/Osinbajo administration started to do everything they should not do while failing to do the things they ought to do. The GMD went to some fuel stations that were allegedly hoarding products and ordered that their stock be sold to the public FREE OF CHARGE. This act won some cheap admiration from the public but it was illegal. The act amounts to “breaking and entry and armed robbery”. The GMD does not have any power to break into and loot private property. Meanwhile, the same government ordered security men to arrest people selling petrol in plastic kegs. Parents and businesses, who were willing to buy the more expensive “black market”, could neither take their children to school nor meet their obligations to their customers. Fuel stations hoard only because of NNPC’s failure and there is nothing wrong if a person sucks the petrol in his “Keke Napep” into a keg and sells it at a higher price. It is his legitimate reward for work done.

While they were busy doing everything they should not have done (just increasing the “JOY” of some crooked officials), they failed to do what should have been done. The only reason why people spent many painful hours on the queue was because of motorists shunting and entering the stations through the exit gates. Military men and other para-military men had no regards for the queues while in many stations, and these same officials authorised other motorists to enter stations through the exit gate for a fee of N500. If these practice had been addressed by the government and the queues were kept orderly, motorists would not have spent more than an hour on the queue and the hardship, loss of time, waste of life would have been greatly reduced.

On the issue of this “ghost price limit hike”, Nigerians cannot be expected to trust this administration any longer. Therefore, the government must stop playing these childish games with the people’s lives and come up with an honest policy of full deregulation. Under such a policy, fuel importers must not be required to obtain any form of licensing or permit (which could be a major road block for collecting “egunje”) from NNPC or DPR as long as the product quality standards are met. Also, the fixing of price limits must be abolished immediately with NNPC operating only as a player and no longer as a regulator. Furthermore, the storage assets of NNPC must be constituted into a fully commercial venture offering its services to all players at market determined rates. Finally, the Buhari administration must guarantee investors that these changes will remain in place as long as they are in office and no advantage would be given to their business or political associates over others.

Selective righteousness cannot get you into heaven.

Tolu Onabolu is an Economist and former banker worker.