Nigerians rush to buy fuel to beat impending price hikes
(Reuters) - Long fuel queues returned to Nigeria's cities on Tuesday as motorists rushed to fill their tanks while some retailers hiked prices amid uncertainty on the timing of the removal of a fuel subsidy that new President Bola Tinubu said would be scrapped.
Removing the subsidy, which cost about $10 B last year, was one of Tinubu's campaign promises. He inherits an economy grappling with anemic growth, record debt, foreign exchange shortages, high inflation, poor power supply and falling oil production due to crude theft and underinvestment.
In an inauguration speech on Monday, Tinubu said there was no provision for the subsidy in the budget, adding "so fuel subsidy is gone." Many Nigerians took that to mean the subsidy would be immediately removed.
But the 2023 budget provides for the subsidy up to June 30.
In his first day in office, Vice President Kashim Shettima told reporters the subsidy was a "scam", adding there would be "fierce opposition from those benefiting from the subsidy scam."
State oil company NNPC Ltd, which says it is spending 400 billion naira ($867 MM) monthly on subsidizing the petrol price, said there was enough fuel and discouraged hoarding.
In the commercial capital Lagos, motorists jammed outlets that sold at the regulated price of 185 naira a liter. But some were selling petrol for as much as 500 naira.
"They have increased the price in most places and now I have to join this long line to buy at the normal price," said Adebisi Kolade, who had clocked up two hours in the queue.
Nigeria's fuel regulatory agency said in a statement it was working with NNPC to guarantee a smooth transition that avoids supply disruptions.
In Abuja, fuel prices rose from 195 naira to as much as 450 a liter at several filling stations, the same price sold in the oil producing Bayelsa State in the Niger Delta.