Buhari Seeks Approval of N4trn for Petrol Subsidy

By Adedapo Adesanya

President Muhammadu Buhari is seeking an 800 per cent increase in the provision for petrol subsidy for 2022 from N442 billion to N4 trillion.

This was contained in a letter written to the House of Representatives for a review of the 2022 fiscal framework.

The Speaker of the House of Representatives, Mr Femi Gbajamila, read the letter titled Submission of the Revised 2022 Fiscal Framework during plenary on Thursday.

Mr Buhari in the letter dated April 5 cited the rising market price of crude oil heightened by the Russian-Ukraine war as the reason for the hike in subsidy payment.

“As you are aware, there have been new developments both in the global economy as well as in the domestic economy which have necessitated the revision of the 2022 Fiscal Framework on which the 2022 Budget was based,” he said.

“These developments include spikes in the market price of crude oil, aggravated by the Russian-Ukraine war, significantly lower oil production volume due principally to production shut-ins as a result of massive theft of crude oil between the production platforms and the terminals,” he added.

According to him, the adjustments to the 2022 fiscal framework include a rise in the estimated crude oil price benchmark from $62 per barrel to $73 per barrel.

“A reduction in the projected oil production volume by 283,000 barrels per day, from 1.883 million barrels per day to 1.600 million barrels per day,” the President’s letter read.

In January, the federal government said it will retain fuel subsidy indefinitely and will work on amending the 2022 budget to provide funds for that purpose.

The Minister of Finance, Budget and National Planning, Mrs Zainab Ahmed, at that time said the government realised that the timing of the planned removal of the petrol subsidy was problematic and would worsen the suffering of Nigerians.

According to her, all payments on fuel subsidies were supposed to cease from July 2022 but, “subsequent to the passage of the [Finance] Act, we went back to amend the Fiscal Framework that was submitted to the National Assembly to incorporate this demand, but after the budget was passed we have had consultations with a number of stakeholders.

“It became clear that the timing is problematic, that practically there is still heightened inflation, and also removal of subsidy will further worsen the situation, thereby, imposing more difficulties on the citizens, and Mr President clearly does not want to do that.”