The Federal Government has said the removal of fuel subsidy was not intended to leave Nigerians without measures to cushion the impact of higher petrol prices.
The government said it had, over the past three years, implemented a series of measures aimed at moderating prices, strengthening domestic refining and stabilising the naira.
The position was contained in a presentation by the Federal Ministry of Finance at a press briefing on fuel prices and the subsidy question in Abuja on Thursday.
According to the presentation, deregulation has made domestic refining viable, helping to sustain local fuel supply, while tax and duty waivers have reduced costs for consumers.
The ministry said the waivers save consumers between N400 and N600 per litre, while the government has forgone more than N5 trillion in taxes as part of efforts to moderate prices.
It also highlighted the naira-for-crude policy, under which local refiners purchase Nigerian crude in naira, saying the arrangement helps reduce dollar demand and ease pressure on the foreign exchange market.
On exchange rate stability, the government said the foreign exchange premium had fallen from more than 60 per cent to below five per cent, while the country’s reserves stood at about $55 billion.
The presentation also cited stronger regulatory oversight by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to guard against hoarding, diversion and short-distribution of petroleum products.
Other measures include the removal of taxes and duties on compressed natural gas (CNG) and electric vehicles to promote cheaper transportation alternatives.
The government also pointed to targeted support measures, including electricity subsidies for vulnerable consumers and the provision of feed gas and fertiliser support for producers.
Addressing concerns over the naira, the ministry said the currency was not deliberately devalued, but depreciated after foreign reserves became insufficient to sustain an artificial exchange rate that, according to the presentation, mainly benefited well-connected interests.
The government stressed that “a stable currency is the single biggest lever on pump prices”, adding that maintaining exchange-rate stability remains critical to preventing further pressure on petrol prices.
