Presidency Rules Out Return of Fuel Subsidy, Says Market Will Determine Petrol Prices

The Federal Government has reaffirmed that it will not reinstate fuel subsidy, despite mounting concerns over the rising cost of living since its removal in 2023.

Taiwo Oyedele, Minister of Finance and Coordinating Minister of the Economy, made the position clear on Tuesday while addressing global investors during a meeting in Paris attended by Bola Ahmed Tinubu.

Oyedele argued that fuel subsidies create economic “distortions” and insisted that the government would not introduce price controls, maintaining that market forces should determine petrol pricing.

“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,” he said, adding that evolving geopolitical developments, including tensions in Iran, present new investment opportunities for Nigeria.

Nigeria removed fuel subsidy in May 2023, a move that triggered a sharp rise in inflation and living costs. Headline inflation climbed from 22.41 per cent in May 2023 to 34.19 per cent by June 2024, marking a 19-year high. Food inflation also surged, exceeding 39 per cent by October 2024.

Analysts link the spike to increased fuel, transportation, and food costs, compounded by currency devaluation. Transport fares reportedly rose by nearly 300 per cent in the aftermath, worsening poverty levels across the country.

Addressing investors at the same event, President Tinubu said the removal of subsidy had helped stabilise Nigeria’s foreign exchange market.

“Subsidy that was a burden to the entire country was removed, and ever since we have achieved FX stability,” the president said, according to statements issued by his media aides.

The administration reiterated its commitment to economic reforms focused on fiscal discipline, transparency, and macroeconomic stability. Officials said these measures are aimed at laying the foundation for sustained and inclusive growth.

Oyedele also highlighted Nigeria’s economic performance, noting that the country recorded 11.2 per cent GDP growth in dollar terms in 2025. He said the government remains focused on translating ongoing reforms into tangible benefits for citizens and pledged to begin publishing quarterly financial reports.

Also speaking, Patience Oniha assured investors of prudent debt management and a continued focus on sustainability.

The meeting drew participation from major international investment firms, including Citibank, Amundi, and Prudential Global Investment Management, among others.

President Tinubu, who is on a three-nation trip, reiterated his administration’s commitment to policy continuity, enhanced transparency in the oil sector, and improved security through structural reforms.

He added that the government would prioritise policy stability and effective implementation to ensure that economic reforms deliver measurable benefits for Nigerians.