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By Stella Odueme
The All Progressives Congress Presidential Campaign Council (APC-PCC) has challenged former Vice President Atiku Abubakar to explain the legal, fiscal and operational basis of his proposal to introduce a “production subsidy” for locally refined petrol.
The APC-PCC, in a statement by its spokesman, Dele Alake, on Sunday, said Atiku must explain how the proposed subsidy would operate within the framework of the Petroleum Industry Act (PIA) 2021 and how it would translate into lower petrol prices for consumers.
Atiku had, at a press conference in Abuja on Friday, reiterated his proposal for a production subsidy for locally refined petrol and called on President Bola Tinubu to reduce the pump prices of petrol and diesel.
According to the APC-PCC, Section 205(1) of the PIA provides that unrestricted free-market conditions shall determine wholesale and retail prices of petroleum products.
The council also cited a statement by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), which said it does not fix pump prices or issue administrative price templates except where statutory conditions for intervention are met.
It noted that the NMDPRA had stated that no such market failure had currently been declared.
The APC-PCC therefore asked Atiku to clarify whether refineries receiving the proposed subsidy would be required to sell petrol at a prescribed price.
It said if the answer was affirmative, Atiku should identify the legal framework under which government would impose such a condition and explain how it would be consistent with the PIA.
“If the answer is no, he should explain how public support to refiners would guarantee lower prices at filling stations,” the council said, arguing that without an enforceable mechanism, refiners could receive the benefit while consumers continued to pay market prices.
The APC-PCC also demanded details of the cost and funding mechanism for the proposed intervention.
It said Atiku’s earlier position suggested that the proposal could involve preferentially priced crude for domestic refineries, adding that any discount on crude would reduce the value accruing to the Federation and potentially affect revenues available to the federal, state and local governments.
The council claimed that, depending on the discount size, volume covered and whether the support applied to the entire crude barrel or only petrol sold domestically, the cost could reach between N17 trillion and N21 trillion annually.
It, however, called for the assumptions behind such estimates to be clearly defined.
The APC-PCC asked Atiku to disclose the proposed subsidy rate, annual spending ceiling, volume of crude or petrol to be covered, funding source, mechanism for guaranteeing lower pump prices and safeguards against diversion, smuggling and fraudulent claims.
It also asked him to state whether amendments to the PIA would be required.
The council said an appropriation by the National Assembly could authorise expenditure but would not, by itself, resolve regulatory questions arising under the PIA.
It further challenged Atiku to reconcile his current proposal with his previous support for downstream deregulation.
According to the APC-PCC, Atiku described the petrol subsidy system as fraudulent in November 2022 at the Lagos Business School and pledged to complete its removal.
The council also recalled that Atiku announced on August 25, 2026, that he would “restore it”, referring to petrol subsidy.
It said he should explain why he now favoured restoring subsidy in another form and how the proposed arrangement would avoid the alleged abuse, scarcity, smuggling and fiscal losses associated with the previous system.
The APC-PCC also traced aspects of downstream petroleum deregulation to the administration of former President Olusegun Obasanjo, when Atiku served as Vice President.
It said diesel was deregulated in June 2003 and aviation fuel moved to market pricing under the same administration, while the Buhari administration deregulated kerosene in 2016.
The council noted that petrol was the last major petroleum product retained under the old subsidy regime, which was scheduled to end in June 2023 under the PIA.
It further argued that the Petroleum Industry Act emerged from a reform process that began in 2000, during the first term of the Obasanjo administration.
The APC-PCC contrasted Atiku’s proposal with the Tinubu administration’s emphasis on alternative transport energy, particularly compressed natural gas (CNG) and electric mass transit.
It said more than 120,000 vehicles had been converted to CNG, while additional private conversions and supporting infrastructure were ongoing.
The council also cited reduced transport fares on CNG and electric bus routes in seven states and the Federal Capital Territory.
It said commuters in Borno State pay between N50 and N100 on routes where commercial operators charge between N300 and N600, while passengers on the Suleja-Abuja route pay N550 instead of about N800.
According to the APC-PCC, Kaduna’s free CNG buses carried more than 1.4 million passengers in five months of 2025, resulting in estimated savings of N1.39 billion in fares.
It added that alternative-energy transport in Adamawa State had reduced fares by as much as 50 per cent, while Abia State had deployed 40 electric buses and 20 charging stations.
The council also pointed to developments in domestic refining, saying the Dangote Petroleum Refinery had reached its nameplate capacity of 650,000 barrels per day and reportedly achieved 700,000 barrels per day during performance tests.
It added that the refinery had launched an initial public offering targeting N2.1 trillion for expansion.
On the recent rise in petrol prices, the APC-PCC acknowledged the pressure on Nigerian households and said petrol sold for about N830 per litre before the Middle East crisis pushed crude oil prices above $100 per barrel.
It said a de-escalation of the crisis could contribute to lower crude oil prices and, consequently, petrol and diesel prices globally.
The council added that the NMDPRA was working with the Federal Competition and Consumer Protection Commission to address alleged price-gouging and with the Nigeria Customs Service to tackle diversion of petroleum products across Nigeria’s borders.
The APC-PCC urged Atiku to publish a detailed policy document and obtain an independent legal and fiscal analysis of his proposed production subsidy.
It said every intervention in the downstream petroleum sector should be lawful, transparent, properly costed and capable of delivering measurable benefits to consumers.