The House of Representatives has warned that restoring the former petrol subsidy regime could cost the Federal Government more than N20tn annually, as it unveiled plans to increase Nigeria’s fuel sufficiency to 45 days within the current quarter.
The Chairman of the House Committee on Petroleum Resources (Downstream), Ikenga Ugochinyere, disclosed this in Abuja on Monday while presenting reports on the committee’s oversight activities and the Federal Government’s downstream petroleum reforms.
Ugochinyere said the proposed return to the old pump-price arrangement would place an unsustainable burden on public finances, noting that the estimated annual cost was close to the total revenue shared by the federal, state and local governments in 2025.
He said Nigeria consumed about 50 million litres of petrol daily, adding that fuel subsidies shifted the cost from consumers to the government rather than eliminating it.
“A blanket subsidy does not lower the cost of fuel; it only changes who pays, and when,” he said.
The lawmaker argued that subsidy removal had increased the funds available to state governments, although he acknowledged the pressure rising fuel prices had placed on households and businesses.
He said any intervention to ease the burden on consumers should be targeted, temporary and affordable.
Ugochinyere attributed some of the pressure on domestic fuel prices to global developments, saying crude oil prices had risen above $100 per barrel amid conflict in the Gulf.
He also announced a nine-point roadmap to strengthen domestic refining, secure crude supplies to local refineries, improve fuel storage and quality control, protect petroleum infrastructure and expand alternative energy sources.
The proposals include enforceable domestic crude supply obligations, amendments to the Petroleum Industry Act 2021, regulation of fuel imports, a national strategic stock, nationwide fuel-quality laboratories, expanded compressed natural gas and liquefied petroleum gas infrastructure, pipeline security, targeted consumer relief and timelines for rehabilitating state-owned refineries.
On fuel availability, Ugochinyere said the committee had been informed that Nigeria had achieved more than 25 days of national fuel sufficiency, with domestic refineries contributing significantly to petrol supply.
He said the committee, working with the Nigerian Midstream and Downstream Petroleum Regulatory Authority, planned to raise the figure to 45 days within the current quarter and establish a strategic reserve capable of meeting up to 90 days of demand in 2027.
The committee chairman said crude supplied to local refineries under the Domestic Crude Supply Obligation reached 97.4 per cent of allocated volumes in the second quarter of 2026.
Between January and September, domestic crude accounted for more than 80 per cent of the crude received by Nigerian refineries, while national crude production reached 1.56 million barrels per day in June, the highest level in 74 months, according to him.
Ugochinyere also cited measures introduced by NNPC Limited to ease petrol prices, including a N66-per-litre discount from October 1 and a subsequent 30-day arrangement under which NNPC Retail would sell petrol at cost by foregoing its profit margin.
He said the intervention differed from the former subsidy system because it would be funded through the company’s profit margin rather than direct expenditure from public funds.
On the Port Harcourt and Warri refineries, he said prospective technical partners had conducted on-site assessments as part of efforts to restore the facilities to reliable and profitable operations.
The committee also highlighted the expansion of alternative energy infrastructure, including the commissioning of NNPC Retail’s first solar-powered smart energy station in Abuja in September. The facility provides petrol, cooking gas, compressed natural gas and electric vehicle charging services.
Ugochinyere said between 50 and 70 similar stations were expected to be deployed nationwide within six months. He added that more than 120,000 vehicles were operating on CNG, while NNPC Limited had acquired 500 CNG-powered trucks for fuel distribution and delivered 35 hybrid buses to the Presidential CNG Initiative.
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