By Edozie Obasi-Eze

The Nigerian government has adjourned the removal of fuel subsidies, which had been anticipated to come into force from H2, 2022.

The Minister of Finance, Budget and National Planning, Zainab Ahmed, made the disclosure in Abuja on Monday at a meeting summoned by the Senate President, Ahmad Lawan, at the National Assembly.

She blamed the postponement on inflation, bad timing, the need for rollout of existing refineries and new ones, to reduce the volume of products imported into the country, further consultations with stakeholders, among others.

The Minister did not say when the policy would reactivated, with speculations rife that the idea was shelved due to political undercurrents and perceived resistance by the civil society, labour and other stakeholders.

Ahmed said, “Provision was made in the 2022 budget for subsidy payment from January till June. That suggested that from July, there would be no subsidy.

“The provision was made sequel to the passage of the Petroleum Industry Act which indicated that all petroleum products would be deregulated. Sequel to the passage of the PIA, we went back to amend the fiscal framework to incorporate the subsidy removal.

“However, after the budget was passed, we had consultations with a number of stakeholders and it became clear that the timing was problematic.

We discovered that practically, there is still heightened inflation and that the removal of subsidy would further worsen the situation and impose more difficulties on the citizenry.

“Mr President (Muhammadu Buhari), does not want to do that. What we are now doing is to continue with the ongoing discussions and consultations in terms of putting in place a number of measures.

“One of these include the roll-out of the refining capacities of the existing refineries and the new ones which would reduce the amount of products that would be imported into the country.

“We, therefore, need to return to the National Assembly to now amend the budget and make additional provision for subsidy from July 22 to whatever period that we agreed was suitable for the commencement of the total removal.’’

Recall that national conversations around fuel subsidy removal reactivated when Lawan declared that President Muhammadu Buhari assured him that he had not directed anyone to remove fuel subsidy.

The Senate President had equally questioned claims that Nigeria consumes 100 million litres of petrol daily.

It is worthy of note that the Minister in October 2021, disclosed that the 2022 budget would make provision for petrol subsidy for H1 2022 only, which fueled speculations that the sector would be completely deregulated from H2 2022.