Average daily petrol consumption in Nigeria has fallen by 28 percent after President Bola Tinubu ended subsidy on the fuel over a month ago, according to data from the industry regulator.
Figures provided to Reuters by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) shows that average daily petrol consumption fell to 48.43 million litres in June, down from an average of 66.9 million in the previous months.
– Why this matters
The decades-long subsidy kept petrol prices affordable for millions in Nigeria where at least 63% of the population live below the poverty line. The government spent N4.39 trillion on petrol subsidy last year, according to the Nigeria National Petroleum Corporation (NNPC).
Mr Tinubu announced the removal of petrol subsidy in his inaugural speech on May 29, and the market responded instantly with prices rising nearly threefold. A litre of petrol rose from N185 to N537, and in some places above N600, the widest margin of increase in 30 years.
The increase has left many Nigerians struggling to commute and pay transport fares. Some have been unable to go to work, prompting a number of offices to allow their staff work remotely.
– Learn more
President Tinubu offered a promising outlook following his removal of fuel subsidy that has imposed huge cost on long-suffering citizens, telling them he “feels their pain” and their suffering will not be in vain. Not many citizens agreed.
The scrapping of petrol subsidy has resulted in the collapse of a thriving black market in neigbouring Cameroon, Benin, and Togo, which depended on petrol smuggled from Nigerian.
The World Bank says despite having spent $2.41 billion on the subsidy in the first five months, Nigeria could save up to $5.1 billion this year from scrapping the petrol subsidy and from foreign exchange (FX) reforms.
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