Subsidy removal saved Nigeria from Venezuela’s fate — Lokpobiri

The Minister of State for Petroleum Resources (Oil), Senator Heineken Lokpobiri, has stated that the removal of the petrol subsidy prevented Nigeria from suffering an economic collapse similar to that of Venezuela.

Lokpobiri made the assertion while speaking at the national summit of the Former Presiding Officers of State Houses of Assembly in Nigeria (FOPSHAN APC).

He noted that the former subsidy regime placed a heavy financial burden on the country without delivering commensurate benefits to citizens.

According to the minister, the system largely benefited a small group of people while draining government resources.

Highlighting the scale of the financial strain, Lokpobiri pointed out that continuing with the arrangement would have left Nigeria in an unsustainable fiscal position.

The decision to end the subsidy was announced by President Bola Tinubu during his inauguration on May 29, 2023. The policy resulted in a sharp rise in petrol prices as the government stopped absorbing the costs that had kept retail prices below market value.

While the Federal Government has repeatedly defended the reform as essential for reducing fiscal pressure and freeing up resources for infrastructural and economic development, the policy has also driven up transportation and household living costs, making it one of the administration’s most consequential reforms.