‘Arithmetic flaw’ -Presidency blasts Atiku’s petrol subsidy plan

The Presidency has strongly criticized the plan proposed by Atiku Abubakar, the presidential candidate of the African Democratic Congress (ADC), to restore petrol subsidy if he is elected in the upcoming 2027 general elections. In a recent post on X, Sunday Dare, the Special Adviser to President Bola Tinubu on Media and Public Communication, referred to the proposal as an 'arithmetic flaw.'

Dare argued that selling crude oil to local refineries at lower prices could lead to fiscal, market, and smuggling issues. According to him, this proposal would significantly reduce the revenue available to the three levels of government - federal, state, and local - for important services like education, healthcare, and security. He pointed out that selling federation crude below market prices would create a direct fiscal deficit in the Federation Account.

Dare also cautioned that such preferential crude pricing could distort competition in the downstream petroleum sector. He warned that this arrangement might facilitate the creation of artificial monopolies, destabilize smaller indigenous modular refiners, and conflict with the deregulatory provisions of the Petroleum Industry Act.

He also raised concerns about the potential resurgence of fuel smuggling if subsidized petrol is sold at a significantly lower price in Nigeria compared to neighboring countries. Dare emphasized that any regime that creates a substantial disparity between Nigerian pump prices and those in West African markets would inevitably encourage cross-border fuel arbitrage.