Former Vice-President Atiku Abubakar has reaffirmed his pledge to restore a targeted fuel subsidy if elected president in 2027, putting the controversial policy back at the centre of the emerging presidential campaign.
Atiku made the commitment in a statement on X on Tuesday after receiving the Osun State leadership of the African Democratic Congress (ADC) in Abuja.
The declaration comes days after conflicting comments from one of his media aides over whether an Atiku administration would eventually phase out the subsidy.
Atiku said his position had not changed. “On the question of subsidy, my position has not changed and will not change: I will restore it! A nation as blessed as ours has no business abandoning its citizens to hardship. Nigeria is rich enough to look after her own.”
The former vice-president said the proposed intervention would aim to reduce the pressure of fuel, transport and food costs rather than recreate the former system of subsidising imported petrol.
“I believe the wealth of a nation is not measured by how much government collects, but by how much the money in the pockets of its people can buy.”
He added: “I want wages to have value again. I want farmers to move produce without transport swallowing their profits. I want families to fill their baskets without emptying their pockets. I want businesses to produce, employ and prosper.”
Why is Atiku raising subsidy again?
Fuel subsidy has remained one of Nigeria's most politically sensitive economic issues since President Bola Tinubu announced its removal during his inauguration on 29 May 2023.
The policy ended a system that had kept petrol prices below market levels but had also placed a substantial burden on public finances.
The removal contributed to a sharp increase in petrol prices and added pressure to transport and household costs.
The International Monetary Fund (IMF) has acknowledged that the reforms improved Nigeria's macroeconomic position, while also noting that poverty and food insecurity increased.
Atiku is now presenting a different approach: use government intervention to lower energy costs and increase consumers' purchasing power.
“That is why I will restore targeted subsidy and put purchasing power back in the hands of Nigerians,” he said.
His argument is that lower fuel costs could reduce transport expenses, which would in turn ease some of the costs faced by farmers, traders, manufacturers and households.
However, the link is not automatic. Fuel prices are only one factor affecting food and transport costs.
Exchange rates, insecurity, electricity costs, road infrastructure, agricultural productivity and logistics also influence prices.
The World Bank has identified transport, power, storage, security and other supply-chain problems as important factors behind Nigeria's food-price pressures.
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What exactly would Atiku subsidise?
This remains one of the biggest unanswered questions.
Atiku has described his proposal as a targeted subsidy, rather than a return to the old import-dependent system.
“I will support Nigerian production, reduce energy costs and restore purchasing power. I will not restore the import racket; I will restore relief.”
His camp has previously sought to distinguish the proposal from the former subsidy regime, saying an intervention could support domestic refining and be capped, transparently budgeted and independently audited.
Those details matter because a subsidy ultimately has to be paid for.
The IMF estimated that savings from Nigeria's fuel subsidy removal could amount to up to 2% of GDP, although it said in its 2026 assessment that the expected savings did not appear to have accrued fully to the budget in 2025.
Any future government seeking to restore a subsidy would therefore need to explain how much it would cost, who would qualify, how the price would be determined and how the government would prevent fraud and diversion.
A significant change from the 2023 debate
Atiku's current position also needs to be viewed against the debate before the 2023 presidential election.
In 2023, Atiku supported the eventual removal of the subsidy, although he criticised the way the Tinubu administration implemented it.
He said a government removing the subsidy should first provide measures to protect Nigerians from the immediate shock.Since then, he has increasingly argued that the economic consequences of the reform have placed too much pressure on households.
In 2024, he also criticised reports that the government was covertly continuing fuel subsidies, arguing that such spending lacked transparency.
The current proposal therefore represents a shift in emphasis: from accepting subsidy removal in principle to advocating a targeted intervention to reduce its impact on consumers.
What does the government say?
The Tinubu administration has defended subsidy removal as a necessary part of its economic reforms.
The government has argued that eliminating the subsidy would free public resources for development and reduce the financial burden created by keeping petrol prices artificially low.
The IMF has similarly said Nigeria's reforms improved macroeconomic stability and strengthened investor confidence.
However, it has also stressed the need to ensure that fiscal savings reach priority spending and vulnerable households.
This creates an important distinction in the political debate.
The question is not simply whether petrol should be cheaper. It is whether government can make it cheaper in a way that delivers relief to households without recreating a costly and opaque system.
Who could benefit?
A properly designed targeted intervention could benefit households that spend a large share of their income on transport and energy.
Farmers and food producers could also benefit if lower energy and logistics costs translate into cheaper movement of agricultural produce.
Manufacturers and small businesses could gain from lower operating costs, although the impact would depend on whether the intervention also improves electricity supply, foreign-exchange stability and other production costs.
But there are potential losers.
Money spent subsidising fuel cannot simultaneously be spent on roads, healthcare, education, security or direct social protection unless government has sufficient additional revenue.
There is also the risk that wealthier households, who generally consume more fuel, could receive a larger absolute benefit from a broad subsidy than poorer Nigerians.
The IMF has warned more generally that fuel subsidies are an inefficient way of supporting low-income households because a relatively small share of the benefit reaches the poorest households.
What happens next?
Atiku's pledge is currently a campaign commitment, not an implemented government policy.
If the proposal becomes part of the ADC's 2027 manifesto, voters will need more information about its design, cost and funding.
They will also need to know how the proposed subsidy would interact with Nigeria's domestic refining capacity, petrol pricing, oil revenues and the wider fiscal reforms introduced since 2023.
For now, Atiku says the objective is straightforward.
“When fuel rises, transport rises. When transport rises, food rises. When food rises, families suffer.”
“I will break that wretched chain that has defined our national life in the nearly four years of Tinubu’s presidency.”
His final promise was broader than fuel prices: “I will make the naira in your pocket worth more, make daily living affordable again, and secure our people.”
Whether targeted subsidy can achieve those goals without reproducing the fiscal and governance problems associated with the old system is likely to become a major issue in Nigeria's 2027 presidential campaign.
