The All Progressives Congress Presidential Campaign Council has criticised former Vice President Atiku Abubakar’s proposal for a production subsidy on locally refined petrol, warning that the policy could revive fuel smuggling and increase pressure on government revenue.
The council’s spokesman and Minister of Solid Minerals Development, Dele Alake, raised the concerns in a statement on Sunday, following Mr Atiku’s renewed call for a production subsidy and lower petrol and diesel prices.
Mr Atiku had proposed subsidising locally refined petrol as a way of reducing pump prices. The APC-PCC, however, questioned how the proposed intervention would operate under the Petroleum Industry Act 2021.
The council cited Section 205(1) of the Act, which provides for unrestricted free-market conditions in determining wholesale and retail petroleum product prices.
It also referenced the Nigerian Midstream and Downstream Petroleum Regulatory Authority, which recently said it does not fix petrol pump prices or issue administrative pricing templates except where statutory conditions for intervention are met.
The council therefore asked whether refineries receiving the proposed subsidy would be required to sell petrol at a government-prescribed price.
According to the APC-PCC, if such a requirement exists, Mr Atiku should identify the legal basis for it. If there is no such requirement, the council questioned how government support to refiners would guarantee lower prices for consumers.
Council estimates subsidy could cost trillions
The APC-PCC also questioned how the proposed subsidy would be funded.
It argued that if crude oil were supplied to domestic refiners at a preferential price, the discount could reduce revenue accruing to the Federation and consequently affect funds available to the Federal Government, states and local governments.
The council estimated that the proposed intervention could cost between N17tn and N21tn annually, depending on the subsidy rate, volume covered and whether the support applied to the entire crude barrel or only petrol sold domestically. It stressed that the assumptions behind the estimate would need to be clearly defined.
It asked Mr Atiku to disclose the proposed subsidy rate, annual spending limit, volume of crude or petrol covered, funding source and mechanisms for ensuring that the benefit reaches consumers.
The council also sought safeguards against diversion, smuggling and fraudulent claims, as well as clarification on whether amendments to the Petroleum Industry Act would be necessary.
APC raises Atiku’s previous position
The campaign council also questioned what it described as a change in Mr Atiku’s position on petrol subsidy.
It recalled that in November 2022, while speaking at the Lagos Business School, Mr Atiku described the petrol subsidy system as fraudulent and pledged to complete its removal.
The council also referred to an August 25, 2026 post by Mr Atiku on X in which he wrote, “I will restore it!”
The APC-PCC subsequently asked him to explain how the proposed subsidy would avoid the problems associated with the previous system, including smuggling, scarcity and fiscal losses.
Government promotes CNG, electric transport
The APC-PCC contrasted the proposed petrol subsidy with the Tinubu administration’s focus on alternative-energy transportation.
The council said more than 120,000 vehicles had been converted to compressed natural gas, while CNG and electric buses were being deployed in states and the Federal Capital Territory.
It cited reported reductions in transport fares on some routes, including services in Borno, Kaduna, Adamawa, Abia and Niger states.
According to the council, Kaduna’s free CNG buses transported more than 1.4 million passengers in five months in 2025, with estimated savings of N1.39bn for commuters. It also said Abia had deployed 40 electric buses and 20 charging stations.
Subsidy debate returns to Nigeria’s fuel market
The APC-PCC said the Federal Government would maintain a deregulated downstream petroleum market, arguing that the policy had encouraged investment in domestic refining.
The council cited the Dangote Petroleum Refinery, whose stated capacity is 650,000 barrels per day, and said the facility had reportedly processed up to 700,000 barrels per day during performance tests.
The council acknowledged the pressure that high petrol prices have placed on households but maintained that any intervention should have a clear legal basis, defined funding mechanism and a system capable of ensuring that consumers benefit.
It urged Mr Atiku to publish a detailed policy document alongside independent legal and fiscal assessments of his proposed production subsidy.
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