The Centre for the Promotion of Private Enterprise (CPPE) has backed the Federal Government’s temporary fuel price relief initiative, insisting that the measure should not be mistaken for a return to Nigeria’s discontinued petrol subsidy regime.
The organisation’s Chief Executive Officer, Dr Muda Yusuf, said the intervention was necessary to ease the financial pressure on households and businesses following the recent surge in petroleum prices.
In a policy brief released on Tuesday, Yusuf attributed the increase in fuel costs largely to developments in the international energy market, particularly geopolitical tensions that pushed crude oil prices above $100 per barrel.
He explained that the current situation represented an external economic shock affecting countries across the world, rather than a direct consequence of Nigeria’s decision to remove petrol subsidies.
According to him, governments can introduce temporary relief measures during exceptional economic difficulties without abandoning broader economic reforms.
Yusuf maintained that economic policies should remain flexible enough to respond to citizens’ needs, particularly when rising costs threaten household welfare and business operations.
CPPE Distinguishes Fuel Relief From Subsidy
The organisation argued that the current intervention differs significantly from the previous petrol subsidy arrangement in terms of its scope, financial implications and effect on the economy.
Under the former system, the government covered part of the cost of petrol consumed nationwide, placing considerable pressure on public finances.
However, the latest initiative involves a temporary reduction in the retail profit margin of the Nigerian National Petroleum Company Limited (NNPC), rather than a broad government-funded programme to control petrol prices.
Yusuf stressed that a limited intervention designed to cushion consumers against an exceptional price increase does not necessarily represent a reversal of the subsidy removal policy introduced in May 2023.
He also noted that the current arrangement does not establish a uniform national petrol price or compel private petroleum marketers to sell their products at government-determined rates.
The CPPE chief executive warned, however, that any intervention must be transparent, time-bound, proportionate and financially sustainable to prevent it from undermining the gains of existing economic reforms.
Organisation Warns Against Restoring Universal Subsidy
While acknowledging the difficulties Nigerians face because of rising fuel prices, the CPPE cautioned against bringing back the former nationwide subsidy programme.
Yusuf argued that restoring a broad-based subsidy would recreate significant fiscal challenges, potentially diverting public resources from infrastructure, healthcare, education and other essential services.
He maintained that the removal of petrol subsidies was an important structural reform, although its benefits must translate into tangible improvements in citizens’ living conditions.
The organisation also emphasised the importance of maintaining a predictable petroleum pricing framework to encourage investment in domestic refining, protect competition and strengthen Nigeria’s energy security.
According to the CPPE, reversing the reform could weaken investor confidence and recreate economic distortions associated with the previous subsidy regime.
CPPE Calls for Wider Support for Households and Businesses
Beyond the temporary petrol price relief, the organisation urged the Federal Government and other tiers of government to introduce broader measures to reduce the effects of rising energy costs.
It recommended increased investment in affordable public transportation, including compressed natural gas-powered and electric buses, to lower commuting expenses for workers, students and low-income households.
The group also called for stronger support for agricultural production, including improved access to fertilisers, machinery and other essential farming inputs.
It further urged state and local governments to consider targeted assistance for vulnerable households, subsidised transport services and other interventions designed to reduce living costs.
According to Yusuf, such programmes should have clear eligibility requirements, transparent funding arrangements and defined timelines to ensure accountability and prevent misuse.
The organisation maintained that targeted social protection and investment in essential services could provide broader benefits than a limited reduction in petrol prices alone.
CPPE Urges Government to Protect Economic Reforms
The group reiterated that the priority should be to preserve market-based petroleum pricing while addressing the social and economic difficulties arising from higher energy costs.
It urged the government to demonstrate how the additional revenue generated following subsidy removal was being used to improve public services, infrastructure and citizens’ welfare.
The CPPE concluded that Nigeria did not need to return to the previous subsidy system but required a more effective framework for protecting vulnerable citizens during periods of exceptional economic pressure.
It stressed that economic reforms would be more sustainable if Nigerians could see clear improvements in their purchasing power, access to essential services and overall living standards.
