The Independent Media and Policy Initiative (IMPI) has faulted former Vice-President Atiku Abubakar’s criticism of the Federal Government’s fuel price relief measures, insisting that the intervention was fundamentally different from the subsidy proposal advanced by the African Democratic Congress (ADC) chieftain.
IMPI in a policy statement signed by its Chairman, Dr Omoniyi Akinsiju, said the 30-day fuel discount at Nigerian National Petroleum Company Limited (NNPCL) retail outlets and the price modulation plan were designed to cushion the impact of rising global oil prices without imposing a significant burden on public finances.
Atiku had described the fuel price rebate as a “panic-driven stunt,” questioning its capacity to address structural inflation and provide relief to motorists who buy petrol outside NNPCL stations.
But the think tank argued that the 30-day window was a review period, not an indication that the intervention would automatically expire.
It said the timeframe would allow the government to monitor market conditions, assess the policy’s impact on inflation and adjust pricing parameters in response to changing economic realities.
The statement partly reads: “Modern macroeconomic management requires short-term, iterative policy windows to monitor market impacts on inflation, prevent immediate household panic, and track supply-chain leakages before extending or adjusting parameters.”
IMPI also rejected claims that the intervention amounted to a return to petrol subsidy, arguing that the NNPCL would forgo commercial retail margins to sell petrol at landing cost rather than rely on direct government payments to marketers.
The group said the arrangement was therefore different from the former subsidy regime, which required public funds to cover the gap between regulated prices and the actual cost of supply.
It also defended the proposed ₦1,350-per-litre ceiling on petrol’s ex-gantry or landing cost, describing it as a mechanism for moderating price volatility rather than a rigid price control.
The ceiling, it said, would be reviewed every 30 days in line with an economic formula.
Comparing the policy with Atiku’s proposal under the Atiku Economic Recovery Plan (AERP), IMPI said the two approaches reflected different methods of managing the downstream petroleum sector.
According to the group, the Federal Government’s model relies on market-linked forward pricing, with crude oil supplied to refiners using international benchmarks and agreed naira conversion rates or pre-negotiated landing-cost targets.
Atiku’s proposal, by contrast, envisages a budgeted production subsidy under which the government would pay refinery owners the difference between the cost of production and the specified price, subject to auditing and fiscal limits.
IMPI warned that such an arrangement could place additional pressure on public finances and undermine investor confidence in the oil and gas industry.
“Supplying crude below its true economic value imposes a heavy opportunity cost on the Federation Account,” the statement said.
The think tank also questioned the feasibility of compelling international oil companies (IOCs) and private joint-venture partners to supply crude at government-mandated discounts, warning that the move could trigger contractual disputes and costly international arbitration.
It further argued that forcing discounts on crude supplied under joint-venture and production-sharing contracts could discourage investment, with international operators potentially redirecting exploration budgets to more investor-friendly markets.
“This is precisely why Nigeria failed to record Final Investment Decisions (FIDs) on new oil and gas projects in the past until the advent of the President Tinubu administration.”
