There is something instructive about Atiku Abubakar’s proposal to reintroduce a form of petrol subsidy. I understand the attraction. Nigerians are hurting. Transport fares remain high, businesses are struggling with energy and logistics costs, and household purchasing power has been badly weakened. Any serious politician should seek to make life more affordable.
But cheaper petrol is not necessarily the same thing as better economic policy.
Atiku’s proposal is striking because it represents a departure from his 2023 presidential campaign position. In November 2022, while seeking the PDP presidential ticket, Atiku described fuel subsidy as “a fraud” and promised to remove it within his first 100 days in office. His spokesperson has now acknowledged that position, arguing that a responsible leader must be willing to change policy when its consequences hurt citizens.
That argument is fair. Politicians should not be prisoners of their past positions. But changing course on such a consequential policy requires explaining why bringing it back will produce a better outcome than fixing the weaknesses of the reform.
To be fair, Atiku is not proposing a return to exactly the old system. His Economic Recovery Plan proposes what he calls a production subsidy, under which qualifying Nigerian refineries would receive crude at a preferential price, subject to production, efficiency, transparency and domestic-supply conditions. He also proposes a fiscal ceiling and independent auditing.
These safeguards sound attractive. But a subsidy remains a subsidy because somebody pays. If government sells crude below market value, the Federation loses revenue, whatever the label.
And Nigeria has been down this road before.
Petrol subsidy was introduced in 1974. For about five decades, successive governments tried to reduce or remove it, but political resistance repeatedly stopped them. Governments kept chipping away at the subsidy without solving the underlying distortions, and Nigerians did not become richer. In many cases, they became poorer.
That history matters. A policy that operated for roughly 50 years cannot reasonably be expected to have all its consequences reversed within three years. The pain is real, but it does not automatically prove the reform was wrong.
The old system became associated with opaque claims, smuggling and enormous fiscal costs. The World Bank estimated that Nigeria spent more than ₦8.6 trillion on petrol subsidies between 2019 and 2022, with wealthier consumers capturing a disproportionate share.
The central question, therefore, is not whether Atiku can design a better subsidy. It is whether Nigeria should return to subsidising petrol when the country is finally beginning to escape that fiscal trap.
Consider what has happened to public finances since the reform.
The removal of subsidy has been painful, but it has also increased revenues available to the three tiers of government. The Federal Government says the reforms generated an additional ₦15.8 trillion for the Federation between June 2023 and December 2025.
States and local governments have had greater resources to meet obligations. Salaries and pensions have been cleared in many places, while some governments have begun addressing outstanding debts and other commitments.
So Nigerians should ask: would we rather have cheaper petrol while workers and pensioners remain unpaid, or have government recover the fiscal capacity to meet these obligations?
A worker who has not received a salary cannot eat cheap petrol. A pensioner cannot buy food with a subsidised litre.
There is also the question of the naira. Tinubu’s administration removed subsidy while moving the exchange-rate system towards greater market determination. Both reforms created hardship, but addressed major distortions.
Returning to subsidy without explaining its interaction with the foreign-exchange market would be risky. What happens when the naira weakens, crude prices rise or refinery costs increase? Will government maintain the ceiling or spend more under political pressure?
The bigger issue is opportunity cost. Every naira government gives up to make petrol cheaper is a naira that cannot be used elsewhere.
That brings us to infrastructure.
For years, Nigerians watched federal road projects drag on while major corridors remained neglected. Today, the Federal Government is pursuing major projects including the Lagos-Calabar Coastal Highway, Sokoto-Badagry Superhighway, Calabar-Ebonyi-Abuja Superhighway and Akwanga-Jos-Bauchi-Gombe-Biu-Maiduguri corridor.
These roads are economic infrastructure. They can reduce the cost of moving food from farms to markets, connect producers to consumers and improve access to ports.
A cheaper litre may provide immediate relief. A functioning highway can lower logistics costs for decades.
The same principle applies to education. Government can target support at people who need it most. NELFUND is an example of investing directly in education rather than subsidising a commodity consumed by rich and poor alike.
None of this means government should ignore the suffering caused by subsidy removal. It must not. Reform will only remain sustainable if Nigerians see tangible benefits: better roads, reliable electricity, public transportation, healthcare, jobs and targeted welfare.
The answer to expensive petrol should ultimately be cheaper production, not permanently cheaper government-controlled prices.
Nigeria should increase crude production, ensure reliable crude supply to domestic refineries, improve infrastructure, strengthen regulation, expand gas development and reduce logistics costs. If Atiku’s proposal is genuinely about accelerating domestic refining, the focus should be removing obstacles that make local refining expensive, not making government the permanent financier of cheap petrol.
Atiku was right in 2022 to recognise that Nigeria could not indefinitely sustain petrol subsidy. The fact that the reform has been painful and unevenly managed does not necessarily mean the original economic diagnosis was wrong. Perhaps Nigerians simply have not yet seen enough of its benefits.
Government must therefore make those benefits visible. Nigerians should see additional revenue going into roads, transport, social protection, healthcare, education and productive sectors.
But returning to subsidy because reform is politically difficult risks recreating the very problem Nigeria spent decades trying to escape.
Atiku must answer difficult questions. How much will the subsidy cost? What happens when the ceiling is reached? How will he prevent another subsidy racket? How will it work with a market-determined exchange rate? What will Nigerians sacrifice to finance it?
Of course Nigerians deserve lower living costs. But the goal should be to make Nigeria cheaper to live and work in, not merely to make petrol cheaper.
We need affordable mass transportation, lower logistics costs, reliable electricity, better roads, more jobs and greater purchasing power.
Nigeria has paid a huge price to correct fiscal and foreign-exchange distortions. We should not throw away reform because its early years are painful.
The better choice is to improve it, protect the vulnerable and invest its gains wisely.
Nigeria does not need another 50 years of subsidy. It needs an economy strong enough that Nigerians no longer need one.