Should Atiku Abubakar Return Fuel Subsidy? How He Can Strengthen Nigeria’s Economy
By Umar Usman Duguri
The debate over Nigeria’s fuel subsidy has returned to the centre of the 2027 presidential contest following a fresh pledge by former Vice President and African Democratic Congress (ADC) presidential candidate, Atiku Abubakar, to restore petrol subsidy if elected president.
Atiku’s position reflects one of the most difficult questions confronting Nigeria today: should the country continue with a market-driven petrol pricing regime, or should government intervene to make fuel cheaper for citizens?
Speaking recently, Atiku argued that he did not initially oppose the removal of the subsidy but questioned what happened to the resources supposedly freed by the policy. He has now promised that, if elected, he would restore the subsidy and pursue those responsible for allegedly mismanaging public funds.
The proposal will resonate with millions of Nigerians who have endured sharply higher transportation, food and production costs since the subsidy was removed in May 2023. But it also raises a fundamental economic question: can Nigeria afford to return to the old subsidy model without recreating the fiscal problems that contributed to its collapse?
The answer requires something more sophisticated than simply saying “subsidy is good” or “subsidy is bad.”
The case for Atiku’s proposal
There is a legitimate argument behind Atiku’s position.
Fuel is not merely another commodity in Nigeria. Petrol affects transportation, agriculture, manufacturing, logistics, electricity generation and virtually every aspect of household consumption.
When petrol prices rise dramatically, the consequences spread throughout the economy.
Transport operators increase fares. Farmers face higher costs moving inputs and produce. Manufacturers spend more on logistics and energy. Traders pass increased transportation costs to consumers. Families spend more of their income moving to work, buying food and meeting basic needs.
The social consequences have been significant. Nigeria's cost-of-living crisis has remained severe, with millions of households struggling to cope with elevated food and fuel costs.
Therefore, Atiku is not wrong to identify the suffering associated with the current pricing regime.
The more difficult question is whether a blanket petrol subsidy is the best solution.
The danger of simply bringing back the old subsidy
Nigeria has experienced the problems associated with fuel subsidies before.
The previous system consumed enormous public resources, created opportunities for corruption and made government finances vulnerable to fluctuations in crude oil prices and petrol consumption.
President Bola Tinubu justified the 2023 removal by arguing that the subsidy had become unsustainable and that the resources could be redirected towards healthcare, education, infrastructure, housing and security.
The current administration maintains that the reform helped strengthen public finances and avert a deeper fiscal crisis. Finance Minister Taiwo Oyedele has also argued that the reforms helped improve government finances and investor confidence, although the immediate consequences have been painful for households.
There is therefore a serious economic risk in simply returning to the old arrangement.
If the government pays a large subsidy without fixing the structural problems surrounding petroleum pricing, refining, smuggling, consumption and accountability, Nigeria could once again find itself spending enormous amounts of public money to keep petrol artificially cheap.
That would not necessarily strengthen the economy.
It could weaken it.
But subsidy removal alone is not economic reform
At the same time, it would be equally wrong to conclude that the removal of subsidy automatically makes an economy stronger.
A successful economic reform must ultimately improve the living conditions of citizens.
The government itself acknowledged in 2023 that removing subsidy would cause hardship because higher fuel prices would affect households and businesses.
The central problem is therefore not simply whether subsidy exists.
The real question is what Nigerians receive in return for the sacrifice they are being asked to make.
If subsidy is removed but citizens face expensive transportation, high food prices, weak electricity, expensive credit, unemployment and declining purchasing power, government must demonstrate where the benefits of the reform are going.
Indeed, Nigeria's finance minister said in July that much of the financial savings from subsidy removal and foreign-exchange reforms had been absorbed by higher debt-servicing obligations and increased government spending.
That admission makes Atiku's accountability question politically important.
Nigerians deserve a transparent answer.
Atiku should go beyond subsidy restoration
If Atiku wants to present himself as an alternative capable of strengthening Nigeria's economy, simply promising to restore subsidy will not be enough.
He needs to present a comprehensive economic programme.
A credible Atiku economic agenda should contain at least seven major components.
1. Replace blanket subsidy with targeted support
Instead of returning to an unlimited subsidy system, an Atiku administration could consider a targeted intervention for vulnerable households and critical sectors.
Government could support mass transit, agriculture, public transportation and selected productive industries without subsidising every litre consumed by every Nigerian.
This would reduce the possibility of wealthy Nigerians receiving the largest benefits simply because they consume more petrol.
The objective should be subsidising people and productive activity rather than subsidising waste.
2. Make domestic refining the centre of energy policy
Nigeria is an oil-producing country that historically depended heavily on imported refined petroleum products.
That contradiction must end.
A stronger economy requires functioning refineries, private-sector investment, transparent crude supply arrangements and competitive domestic refining.
The expansion of domestic refining capacity can reduce pressure on foreign exchange, strengthen energy security and create industrial jobs.
If petrol is produced competitively inside Nigeria, government would have less justification for maintaining a massive consumer subsidy.
3. Publish the subsidy savings
Atiku's strongest argument is his demand for accountability.
The government should publish a clear, independently verifiable account showing the fiscal impact of subsidy removal, including savings, additional revenues, increased allocations, debt obligations and expenditure programmes.
The Federal Government has put the financial gains from the reform at substantial levels, while other official explanations have emphasised that subsidy removal primarily corrected a fiscal distortion rather than creating a simple cash windfall.
This apparent difference in interpretation is precisely why Nigerians need transparent numbers.
An Atiku administration should institutionalise such transparency rather than make accountability dependent on political promises.
4. Attack corruption and revenue leakages
Nigeria cannot build a strong economy if government revenue continues to leak through corruption, inefficient institutions, oil theft, tax evasion and poorly monitored contracts.
The country needs stronger public procurement systems, independent audits, digital revenue collection and real-time monitoring of major government expenditure.
Every naira saved from corruption is effectively additional money available for infrastructure, education, health and security.
5. Reduce dependence on oil
No Nigerian president can permanently solve the country's economic problems without reducing dependence on crude oil.
Agriculture, manufacturing, technology, mining, creative industries and services must become major sources of employment and foreign exchange.
The goal should be to create an economy where a fall in oil production or international oil prices does not immediately threaten government finances.
6. Make electricity an economic priority
Nigeria cannot industrialise on expensive diesel and petrol generators.
A serious economic programme must prioritise reliable electricity for manufacturers, small businesses, hospitals, schools and households.
Power-sector reform should combine investment in generation and transmission with decentralised solutions, renewable energy and transparent distribution systems.
Cheaper and more reliable electricity would reduce production costs and, over time, lessen dependence on petrol and diesel.
7. Protect the poor while pursuing reform
Economic reform without social protection can become politically and socially unsustainable.
Atiku would need to establish credible mechanisms for supporting low-income Nigerians during periods of adjustment.
Such programmes should be transparent, digitally verifiable and targeted at genuine beneficiaries.
Cash transfers, public transportation support, school feeding, agricultural assistance and healthcare protection could be more economically efficient than a universal fuel subsidy.
The real test: can Atiku balance relief with reform?
Atiku's proposal presents an opportunity for a broader conversation about Nigeria's economic direction.
There is nothing inherently wrong with government intervention when markets fail or when vulnerable citizens require protection.
But a subsidy that consumes enormous public resources without producing lasting economic value cannot be the foundation of national development.
At the same time, a market-oriented reform that transfers enormous costs to citizens without adequate social protection cannot be considered complete.
Nigeria needs a middle ground.
The country needs fiscal discipline without fiscal cruelty; market reforms without abandoning the poor; and social intervention without returning to wasteful subsidies.
If Atiku becomes president, his economic credibility will therefore depend not merely on whether he restores fuel subsidy, but on whether he can redesign the entire energy and fiscal system.
He should tell Nigerians exactly how much subsidy government would pay, who would benefit, how the programme would be funded, how corruption would be prevented, and when Nigeria would ultimately move towards a sustainable energy pricing system.
Beyond the 2027 election
The fuel subsidy debate should not become another political slogan.
The real issue is whether Nigeria can build an economy that produces affordable energy, good jobs, competitive businesses, strong public institutions and rising household incomes.
Atiku is right to demand accountability over the use of resources released by subsidy reform.
The Tinubu administration is also right that Nigeria could not indefinitely sustain an inefficient subsidy regime.
Both arguments can coexist.
The country can reject the old subsidy system while demanding accountability for the resources freed by its removal.
It can support market reforms while protecting vulnerable Nigerians.
And it can demand fiscal discipline while insisting that government investments produce measurable improvements in citizens' lives.
For Atiku, the challenge is to transform his subsidy promise into a broader economic blueprint.
Nigerians do not merely need cheaper petrol. They need an economy in which their incomes rise faster than prices, businesses can produce competitively, electricity becomes reliable, agriculture becomes profitable, government revenue is transparently managed and public institutions work for the people.
That is the standard by which any 2027 economic programme—including Atiku Abubakar's—should ultimately be judged.
The question, therefore, is not simply whether Atiku should return fuel subsidy. The bigger question is whether he can build an economy in which Nigerians no longer need government subsidy to survive.