By Omeiza Ajayi
The All Progressives Congress Presidential Campaign Council (APC-PCC) has raised fundamental legal and fiscal questions over former Vice President Atiku Abubakar’s proposed “production subsidy” for locally refined petrol, insisting the plan lacks a clear legal framework and could enrich smugglers rather than lower pump prices for Nigerians.
In a statement issued by the Spokesman of the APC Presidential Campaign Council, Dele Alake, on Sunday, the council noted that Atiku, at his press conference in Abuja on Friday, reiterated his proposed subsidy plan, which he claimed would reduce pump prices, while also asking President Bola Tinubu to slash the cost of diesel and petrol at the pump.
The council said the proposal “raises important legal, fiscal and practical questions that he must answer,” citing Section 205(1) of the Petroleum Industry Act (PIA) 2021, which provides that unrestricted free-market conditions shall determine wholesale and retail prices of petroleum products.
It noted that the Nigerian Midstream and Downstream Petroleum Regulatory Authority NMDPRA, in a statement on Saturday, explained that it neither fixes pump prices nor issues administrative price templates, except where statutory conditions for intervention are met, adding that “No such market failure has been declared.”
The APC-PCC asked whether a refinery receiving the proposed subsidy would be required to sell petrol at a prescribed price.
“If the answer is yes, he should identify the legal framework under which the government would impose that price condition and explain how it would operate consistently with the Petroleum Industry Act,” the statement read.
It added that if the answer is no, Atiku “should explain how public support to refiners would guarantee lower prices at filling stations,” warning that “without an enforceable mechanism, refiners could receive the benefit while consumers continued to pay market prices.”
The council further stated that Atiku must disclose the cost of his proposal and how he would fund it, noting that his earlier remarks suggested the intervention could take the form of preferentially priced crude for domestic refineries.
It warned that any discount on crude would reduce the value accruing to the Federation and, consequently, the revenue available to the federal, state and local governments, “triggering afresh the fiscal crisis that made 27 states unable to pay salaries and pensions before President Tinubu assumed office in 2023.”
Based on publicly reported refinery throughput and domestic petrol-supply figures, the APC-PCC estimated that the cost of the new subsidy could run as high as N17 trillion or N21 trillion annually, depending on the discount size, the volume covered, and whether the support applies to the entire barrel or only to petrol sold domestically.
7 posers
Listing seven questions it said Nigerians deserve answers to, the council asked Atiku to state the proposed subsidy rate; the annual spending ceiling; the volume of crude or petrol to be covered; the source of funding; the mechanism guaranteeing lower pump prices; the safeguards against diversion, smuggling and fraudulent claims; and whether amendments to the Petroleum Industry Act would be required.
It added that while an appropriation by the National Assembly may authorise expenditure, it “would not by itself resolve every regulatory question arising under the Petroleum Industry Act,” urging Atiku to state plainly if he intends to amend the law.
The APC-PCC also questioned the consistency of Atiku’s current position with his past support for downstream deregulation, recalling that in November 2022 at the Lagos Business School, he described the petrol subsidy system as fraudulent and pledged to complete its removal, reminding his audience that he chaired the committee that removed its first and second phases.
It noted that on 25 August 2026, Atiku announced on X, “I will restore it!” The council said he must explain “why he now advocates restoring subsidy in another form and how his proposed arrangement would avoid the abuse, scarcity, smuggling and fiscal losses associated with the old system.”
Tracing the history of downstream deregulation, the statement recalled that diesel, which powers food trucks, generators and factories, was deregulated in June 2003 under the Obasanjo-Atiku administration, alongside aviation fuel, while the Buhari administration deregulated kerosene in 2016, leaving petrol as the last major product retained under the old subsidy regime before its scheduled removal in June 2023 under the PIA.
It added that the reform process for the PIA began in 2000, during Atiku’s first term as Vice President, and questioned how his new proposal aligns with that legal and regulatory framework.
The council said the Tinubu administration has instead focused on expanding lower-cost alternatives through Compressed Natural Gas CNG and electric mass transit, noting that more than 120,000 vehicles have been converted to CNG, with thousands more converted privately.
It quoted President Tinubu, who, in his statement on Saturday, recalled the programme he agreed with the governors of the 36 states on August 27, saying: “From October 1, more Nigerians should begin to see measurable reductions in transportation costs.”
According to the statement, commuters in seven states and the Federal Capital Territory FCT are already paying between 31 and 83 per cent less on routes served by CNG and electric buses. It cited Borno State, where services charge between ₦50 and ₦100 on routes where commercial operators charge between ₦300 and ₦600, and the Suleja–Abuja service in Niger State, where passengers now pay ₦550 instead of about ₦800. It added that Kaduna’s free CNG buses carried more than 1.4 million passengers in five months of 2025, saving residents an estimated ₦1.39 billion in fares, while alternative-energy transport in Adamawa State has reduced fares by as much as 50 per cent, and Abia State has deployed 40 electric buses and 20 charging stations.
The council described Atiku’s proposal as a reach “into Nigeria’s past with another subsidy scheme that will enrich smugglers in particular,” adding that he “has yet to tell Nigerians what it will cost or under what law it will operate.” It quoted President Tinubu as urging Nigerians “to ignore politicians who want to drag the country back to the subsidy era,” warning that such a path “leads to mounting debt, petrol queues, payments pocketed by smugglers and cheap Nigerian fuel subsidised for the whole of West Africa.”
The statement noted that Nigeria will continue with a deregulated market that has supported increased investment in domestic refining, pointing to the Dangote Petroleum Refinery, which it said has reached its nameplate capacity of 650,000 barrels per day and reportedly achieved 700,000 barrels per day during performance tests, and has also launched an Initial Public Offering (IPO) targeting ₦2.1 trillion for expansion.
Acknowledging the pressure of higher petrol prices on Nigerian families, the APC-PCC said the Tinubu administration would continue implementing supportive policies, noting that petrol sold for about ₦830 per litre before the Middle East crisis pushed crude oil prices above $100 per barrel, and that a de-escalation of the crisis “could help reduce crude oil prices and, consequently, the pump prices of petrol and diesel, not just in Nigeria, but worldwide.”
It added that the NMDPRA is working with the Federal Competition and Consumer Protection Commission FCCPC against price-gouging and with the Nigeria Customs Service against the diversion of petroleum products across Nigeria’s borders.
The council maintained that every proposed intervention in the downstream sector must be lawful, transparent, properly costed and capable of delivering measurable benefits to consumers, urging Atiku to provide Nigerians with a detailed policy document and an independent legal and fiscal analysis of his proposal. “Until he does so, his production-subsidy plan remains an uncosted promise without a clearly identified legal or operational framework,” the statement said.
Drawing on former President Olusegun Obasanjo’s book, My Watch, the council said the proposal would also qualify as one of those fantasies and policy options anchored on what Obasanjo described as Atiku’s “propensity for poor judgment.” It added: “For a start, we recommend that Atiku read the PIA, as he appears out of touch with reality and the oil sector’s current dynamics.”
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