Former Vice President and African Democratic Congress (ADC) presidential candidate, Atiku Abubakar, has proposed a new petroleum subsidy framework that would shift government support from fuel imports to domestic crude oil production and refining.
Under the plan, contained in the Atiku Economic Recovery Plan (AERP) 2027, eligible Nigerian refineries would receive crude at a preferential price in exchange for meeting strict production, efficiency and domestic supply requirements.
Atiku said the proposal was not a return to the former import-based subsidy regime but an attempt to create a targeted and temporary intervention that would reduce energy costs while strengthening Nigeria’s refining capacity.
“My proposal is not to resurrect the old subsidy regime. We will move subsidy from importation to production, from middlemen to Nigerian refineries, and from unverifiable claims to verifiable barrels,” he said in a statement issued by his Senior Special Assistant on Public Communication, Phrank Shaibu.
He said the principle behind the policy was that “the subsidy will follow the barrel.”
Under the proposed arrangement, refineries receiving preferentially priced crude would be required to supply independently verified quantities of petroleum products to the Nigerian market.
Atiku said crude allocations, refinery intake, production yields, inventories and domestic deliveries would be reconciled to ensure that subsidised barrels could be tracked from allocation to the final consumer.
He also proposed sanctions against operators that divert subsidised crude or products, manipulate production records or fail to pass the benefit of the intervention to consumers.
“If you receive subsidised Nigerian crude, you must refine it in Nigeria, supply the agreed products to Nigerians and pass the benefit to Nigerians. Otherwise, you do not qualify,” he said.
The proposal would also make eligibility available to qualifying public and private refineries based on independently verified capacity, efficiency, domestic supply and compliance, rather than political connections.
Atiku said the proposed intervention would be subject to an annual fiscal ceiling approved through the federal budget, arguing that this would prevent the accumulation of open-ended subsidy liabilities.
He said the National Assembly would determine the appropriation, while independent auditors would verify the crude supplied and products produced.
Where oil revenues exceed budget benchmarks, a predetermined portion of the additional revenue could be deployed within the approved fiscal ceiling. However, Atiku said projected windfalls would not be used to justify spending beyond the limit.
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The framework would also disclose the subsidy’s opportunity cost and its impact on revenues accruing to the federal, state and local governments.
The intervention would contain sunset and periodic review provisions, with support per barrel progressively reduced as domestic refining capacity expands, refinery utilisation improves, competition increases and production costs fall.
“Our objective is not permanent subsidy. It is to use temporary and disciplined support to build a refining industry strong enough eventually not to need subsidy,” he said.
According to Atiku, cheaper energy would ultimately reduce transportation and logistics costs, support manufacturers and farmers, moderate inflation and improve household purchasing power.
The former vice president also used the announcement to challenge President Bola Tinubu’s handling of fuel subsidy removal.
He recalled that Tinubu announced the end of the subsidy during his May 29, 2023 inauguration, after which petrol prices rose sharply.
Atiku argued that subsequent government accounts raised questions about whether subsidy-like petroleum costs continued to be absorbed by public finances.
He cited NNPCL’s audited financial statements, which he said recorded approximately ₦4.84 trillion in Energy Security Expenses in 2023 and N7.13 trillion in 2024.
He demanded clarification on the economic substance of the expenses and whether they included under-recoveries, pricing differentials or other petroleum supply-related costs.
“If government continued absorbing differences between the economic cost of petroleum products and what was recovered from the market, then Nigerians are entitled to ask how that differs economically from the subsidy they were told had disappeared,” Atiku said.
He argued that Nigerians should not simultaneously face market-level petrol prices while public funds continue to absorb unexplained petroleum-related costs.
The ADC presidential candidate also raised questions over what he described as approximately N30 trillion in Federation revenues, deductions, savings, transfers and related funds.
Atiku stressed that he was not alleging that the entire amount represented fuel subsidy or that it had been stolen.
Rather, he called for a month-by-month public reconciliation of the funds and their classifications.
“We are saying that approximately ₦30 trillion reflected across Federation revenues, deductions, savings, transfers and related classifications requires a complete, month-by-month public reconciliation,” he said.
He challenged the Tinubu administration to publish details of deductions, beneficiaries, transfers, balances and the legal authority for each transaction.
Atiku further promised that previous subsidy transactions would be subjected to lawful scrutiny if his administration comes to power.
He said anyone found, through due process, to have fraudulently obtained or diverted public subsidy funds would face prosecution and asset recovery.
The ADC candidate said his proposed model would differ fundamentally from the system he accused the current administration of operating.
“Define the intervention, establish the ceiling, appropriate the money, track the crude, verify the production, guarantee the consumer benefit, publish the accounts and progressively reduce the subsidy,” he said.
Atiku said the ultimate objective was to make Nigeria’s crude oil support domestic refining and economic growth while gradually eliminating the need for government subsidy altogether.