The Subsidy They Said We Could Not Afford: Who Really Paid For Nigeria’s Great Fuel Reform?

Three years after President Bola Tinubu declared that “fuel subsidy is gone,” Nigeria faces a question the political class can no longer postpone: If subsidy removal was necessary to save the economy, why have millions of Nigerians become poorer while government revenues have increased?

This is not an argument for pretending Nigeria’s old subsidy regime was efficient. It was opaque, vulnerable to fraud and rent-seeking, and kept Nigeria dependent on imported refined petroleum despite being a major crude-oil producer.

But identifying the failures of the old system does not prove that transferring the full shock to consumers was the right alternative.

The real issue is distribution: who gained from reform, who lost, and who was asked to pay?

The World Bank has documented substantial fiscal gains from subsidy removal, while Reuters has reported that the reforms improved public finances and investor confidence alongside an intensifying cost-of-living crisis. Petrol prices initially more than tripled after subsidy removal, pushing up transportation and household costs.

Subsidy removal saved government money. The question is what Nigerians received.

THE GREAT TRANSFER

In August 2026, Finance Minister Wale Edun said subsidy removal and related reforms had generated ₦15.8 trillion in resources for the federation between June 2023 and December 2025.

That is extraordinary.

But increased public revenue is not the same thing as increased public welfare.

A government can collect more revenue while households become poorer, commuters spend more getting to work and small businesses struggle with higher energy costs.

The fiscal case, therefore, cannot be the end of the conversation. Revenue is a means, not an end. If revenue is not converted into cheaper transportation, reliable electricity, productive investment, stronger wages and social protection, then Nigerians are being asked to finance adjustment without receiving a social dividend. That is not a successful reform, its a deathtrap.

State governments have received larger allocations, government finances have improved and domestic refiners may benefit.

But the costs have been distributed across society. The commuter, trader, farmer and student pay more.

Fuel sits at the centre of Nigeria’s economy, so its price shock travels through virtually everything.

That is why subsidy removal is not merely a petroleum-sector reform.

It is a distributional policy: it determines who absorbs the cost of economic adjustment.

“WORK HARDER” IS NOT AN ECONOMIC POLICY. For three years, Nigerians have been told to adapt to higher petrol prices, transport fares, food prices and declining purchasing power.

But people cannot work themselves out of an inflationary shock when incomes are not rising at the same pace as prices.

Nigeria’s hardship reflects decades of policy failures, weak productive capacity, inadequate public transportation, dependence on imported refined fuel, currency instability and insecurity.

WE NEED A DIFFERENT SUBSIDY. The old subsidy regime became a source of rent-seeking and opacity.

But the choice is not between the old subsidy and abandoning citizens to market prices.

There is a third possibility: subsidy with full digital transparency. Here is where i support Sowore’s policy reform on fuel.

Nigeria could also support essential public transportation, agriculture and productive sectors rather than indiscriminately subsidizing consumption. Support could be linked to domestic refining, with every naira published and independently audited.

The objective: protect purchasing power while building state capacity.

Nigeria spent decades exporting crude while importing refined petroleum. That contradiction is a political-economic failure, not the fault of ordinary Nigerians. The subsidy debate therefore raises a deeper question: who controls Nigeria’s oil wealth and who benefits from it?

AND THEN THERE IS ATIKU. Few politicians illustrate the contradictions in this debate better than Atiku Abubakar.

As Vice President under Olusegun Obasanjo, Atiku was associated with privatization and commercialization. He also chaired the committee that negotiated phases of subsidy withdrawal.

In 2019, during his presidential campaign, Atiku was unequivocal about privatization. Speaking to the Lagos business community, he described the NNPC as a “mafia organisation” and said he would privatize it “even if they are going to kill me.”

On subsidy, his position was equally clear.

In 2023, Atiku said he had been chairman of the subsidy-removal committee and argued that, if elected, he would continue from where the PDP government had stopped and remove subsidy completely, describing it as a fraud.

Today, however, Atiku is campaigning on restoring subsidy.

THE QUESTION IS NOT WHETHER SUBSIDY IS SACRED. Nigeria does not need to return blindly to the old subsidy regime. Economic reform is not successful simply because government accounts improve.

People are the objective of economic policy, not collateral damage.

If subsidy removal generates trillions in additional public resources but ordinary Nigerians cannot afford transport, food and basic necessities, then the policy must be reassessed.

Restore fuel subsidy—but do it differently, in a way that is transparent, and beneficial to the Nigerian people, not a connected few.

For three years, Nigerians have been told to endure today’s hardship for tomorrow’s prosperity.

As the next election approaches, perhaps the simplest question is also the most important:

Where is tomorrow?

And if it has not arrived, why should Nigerians continue paying for it?

•Written By Juwon Sanyaolu