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  • Oil & Gas - News
  • Updated: February 27, 2024

Removal of petroleum subsidies challenging but vital for Nigeria's future — Tinubu

Removal of petroleum subsidies challenging but vital for Nig

President Bola Tinubu said on Tuesday that the decision to eliminate petroleum subsidies was difficult, but it was a vital step to ensure the country's long-term energy security and economic progress.

The president spoke at the State Banquet Hall, Aso Villa, Abuja, to officially launch the 7th edition of the Nigeria International Energy Summit (NIES 2024).

The conference has the theme "Navigating the New Energy World Order: Security, Transition, and Finance."

Tinubu stated that his administration was dedicated to developing social intervention measures to minimise the short-term consequences of the elimination of fuel subsidies for poor people.

Tinubu, represented by Minister of Information and National Orientation Alhaji Mohammed Malagi, stated that the petroleum subsidy has, over time, taxed Nigeria's economic resources.

This, he claimed, resulted in inefficiencies and hampered investment in vital areas of energy security.

“By removing the subsidy, we are creating a more transparent and accountable energy sector.

“The funds that were previously allocated to subsidising petroleum products are now redirected towards developing and upgrading our energy and other social infrastructure.

“Furthermore, subsidy removal has encouraged further private sector participation in the energy industry with potential of attracting more local and international investors, innovation and competition in the sector.

“I am very aware of the immediate impact this decision may have had on our citizens, especially those with lower incomes.

“Therefore, in parallel with the subsidy removal, my administration is committed to implementing social intervention programmes to mitigate the short-term effects on vulnerable populations,” he said.

These approaches, he said, would ensure that the burden of subsidy withdrawal was spread evenly and that Nigeria's most vulnerable citizens were protected.

The president thanked the conference organisers for the opportunity to discuss subsidy removal once more, stating that it was a critical topic that has been at the forefront of Nigeria's national discourse.

“Our great nation has long been dependent on the revenue generated from oil exports, and as we stand at the crossroads of the 21st century, it is imperative that we re-evaluate our energy policies to ensure sustainable future,” he said.

However, he urged all stakeholders, including industry professionals, governments, and the general public, to engage in constructive dialogue and collaboration as we navigate these hard yet revolutionary times.

He congratulated everyone who helped make the summit a success, saying it demonstrated a common commitment to addressing the problems and opportunities that lie ahead in the dynamic and ever-changing world of energy.

“This marks the first edition of NIES during my administration, and I am honoured to stand before you as we collectively chart a course for the sustainable and secure energy future of Nigeria.

“Energy security, as we know, is of paramount importance. It is not just a national concern; it is a global imperative.

“In the face of emerging challenges, both geopolitical and technological, we must ensure the resilience of our energy infrastructure.

“The decisions we make today will impact the energy security of generations to come,” he added.

He emphasised leveraging innovation and collaboration to ensure a smooth and just transition that would leave no one behind.

“As a nation, we must explore innovative financing models, engage with the private sector, and attract investments that will propel us towards a more resilient and diversified energy sector,” he said.

The summit, holding from Feb. 26 to March 1, has in attendance more than 6,000 foreign and local oil and gas industry players, regulators, and investors.

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