Buhari urged to end Nigeria fuel subsidy

LAGOS, June 22, 2015 – Nigerian President Muhammadu Buhari has been advised by a committee overseeing the country’s government transition to end the country’s fuel subsidy and privatise its four refineries.

The recommendation came in a report by Buhari’s All Progressives Congress party, sources told Reuters.

The fuel subsidy has been vulnerable to fraudulent claims, with one estimate pegging the amount lost to such claims since 2012 at $6 billion.

Goodluck Jonathan, the country’s previous president, reduced the subsidy by 90 percent for the 2015 budget after government revenues dropped with the oil price slump. The decision led to a petrol price hike from $0.40 per liter to $0.86 per liter and was met with protests, including eight days of nationwide strikes.

Nigeria’s downstream sector, hindered by underinvestment and pipeline attacks, operates well below capacity, as low as 20 percent. The recommendation to privatise the country’s four refineries cited government savings on maintenance as a significant benefit.

All four facilities have been closed for maintenance since November 2014. They are expected to resume operation in July.

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