The PPPRA is acting true to the widespread belief that bureaucrats can alter public policy to suit their own preferences – after all, abolishing or ending the fuel subsidy as we know it will cost jobs in the PPPRA and other related high salaried agencies. But as far as the increase in the price of petrol goes, the blame (if any) lies not on the president.


I recently read a matter-of-fact analysis of the recent effort of President Muhammadu Buhari to end the fuel subsidy that’s been one of the factors killing Nigeria’s economy all this while. It was written by a group called Nigeria Business Information (NBI).

According to them, President Buhari granted approval to the Petroleum Products Pricing Regulatory Agency (PPPRA) to remove the subsidy that was in place for petrol. For those of us who do not follow the government’s dos and don’ts religiously, let me volunteer a secret: When the president of Nigeria gives ‘approval’ to one of his executive agencies such as the PPPRA to implement a decision, it’s an order. Apparently, the PPPRA didn’t get this – as can be inferred from its self-serving implementation of the order to which I shall return shortly – but first, the background.

Before COVID-19, Nigeria exported close to two million barrels of our popular “Bonny Light” crude a day. The problem is that not much of this high-quality crude oil is refined here at home because of high-level corruption that has crippled our four state-owned refineries in Kaduna, Warri, and Port Harcourt. As a result, Nigeria has to import fuel for domestic consumption, the raison d’être for the many small-scale artisanal refineries in the Niger Delta region that the government has chosen to unwisely label as ‘illegal’.

A recent study by Stakeholder Democracy Network (SDN), a reputable international resource watchdog, shows that every year Nigeria legally imports about 900,000 tonnes of “low-grade” fuel of extreme toxicity from European refineries. This legally imported fuel is dirtier than the fuel illegally produced by the small-scale artisanal refineries in the Niger Delta. But I digress.

One reason why the PPPRA bosses must have been petrified is that it is their agency that determines the subsidy for the dirty petrol that we import to pollute our country. That subsidy is equal to the difference between the EOMP and the approved retail price of petrol. Guess whose important job it is to determine each and all of the above?


The issue is that at some time in March, President Buhari had granted approval to the PPPRA to remove the price cap (read: subsidy) on petrol. This was inevitable, given that COVID-19 and other external factors had caused the landing cost of petroleum products to crash. One account by Ayodele Oni of Bloomfield Law confirmed that from N123.88 per litre on February 27, the landing cost of petrol had fallen to N64.32 per litre by March 19. This decline meant that the Expected Open Market Price (EOMP) fell below the pump price of petrol, making subsidy unnecessary. That was enough to make PPPRA bosses wet their pants.

One reason why the PPPRA bosses must have been petrified is that it is their agency that determines the subsidy for the dirty petrol that we import to pollute our country. That subsidy is equal to the difference between the EOMP and the approved retail price of petrol. Guess whose important job it is to determine each and all of the above? So the PPPRA bosses seem to have resorted to the damage control mechanism of a press statement carefully crafted for the defiant purpose of ‘twistification’.

The recent increase in the pump price of petrol from N123.80 to N143.8 in these hard pandemic times has predictably brought the ire of the Nigeria Labour Congress against the Nigerian government. But truly, Buhari is not to blame this time.


Of course, this is speculation, but while the first of the ten cleverly-worded points in the press release acknowledges the obvious – that the plunge in the price of crude oil and petroleum products were caused by the pandemic and slowing global oil demand, and that this had led to a drop in the EOMP of the premium motor spirit (petrol for short), and so on; further down came the PPPRA’s smart bit of hocus-pocus: “Therefore, in line with the Government’s commitment to the welfare and common good of the populace, NNPC was directed to review downward its Ex-Coastal price to reflect the current low oil price for the benefit of Nigerians.” This point number three in the PPPRA press release is not true at all. The president’s order was to remove or abolish fuel subsidy, not to reduce or to decrease the pump price of petrol.

The recent increase in the pump price of petrol from N123.80 to N143.8 in these hard pandemic times has predictably brought the ire of the Nigeria Labour Congress against the Nigerian government. But truly, Buhari is not to blame this time.

The PPPRA is acting true to the widespread belief that bureaucrats can alter public policy to suit their own preferences – after all, abolishing or ending the fuel subsidy as we know it will cost jobs in the PPPRA and other related high salaried agencies. But as far as the increase in the price of petrol goes, the blame (if any) lies not on the president.

Ebere Onwudiwe is a distinguished fellow at the Centre for Democracy and Development (CDD), Abuja.