Nigeria is currently facing one of the most grueling fuel crisis in recent times and things are not looking to get any better. This has turned many Nigerians who were previously against removal of fuel subsidy into vehement supporters for the removal. Some Nigerians believe this is probably the best time to do it and an opportunity to end the era of fuel subsidy and that the cabal reaping from fuel subsidy scam is eliminated once and for all.
Unfortunately, even the removal of fuel subsidy and the full deregulation of the downstream sector may not provide the respite and elimination of corruption many anticipate. Who else to explain better but the CEO of Sahara Group, one of the largest players in the downstream space. According to an article of Reuters,
Mr Tonye Cole explained that Nigeria’s crippling fuel shortages are unlikely to ease any time soon and much-needed deregulation of the subsidised market would be a fraught process, the chief executive of energy company Sahara Group said on Wednesday.
Cole said the process of freeing the market would be fraught as adjusting to higher pump prices would be painful for about a year for the average Nigerian, particularly with a weaker currency.
Even for importers, the process of equalising gasoline station prices with import costs would be chaotic, as the many agencies that regulate every minutiae of the supply chain would have to be dismantled.
So on the back of this statement it appears the removal of fuel subsidy may just be a recipe for short term pain for many Nigerians. A lot of unsuspecting Nigerian hoping that the removal of fuel subsidy will provide respite and address the current crisis in the industry may just be made to suffer even much more before things can start to look better.
Also, the removal of fuel subsidy even if it doesn’t do any of the above is likely to take the product out of the reach of many Nigerians. Nigerians may end up buying fuel at N200 per litre and could be a source of grievance with the incoming administration. Add that to the poor power supply in the country and what you could get are even more angry Nigerians.