Data released by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) showed the average daily petrol consumption dropped from the previous average of 66.9 million to 48.43 million litres (13 million gallons) in June 2023.
The figures showing average daily PMS use have been an issue of contention for a while as the Nigerian National Petroleum Company Limited, (NNPCL) and the former Customs Boss, Col. Hameed Ali (retd.), have disagreed on the actual figure representing the daily consumption.
Although the NMDPRA said about 66-68 million litres are consumed daily, Ali however, said the NNPCL could not scientifically prove the 68 million litres per day consumption claims as it supplied a daily excess of 38 million litres as NNPCL allowed the lifting of 98 million litres daily.
Reuters reports that subsidy has played a huge role in the Nigerian petroleum industry as it reduced commodity prices thus allowing citizens to purchase petroleum products at a very low price.
The process of maintaining subsidy payments had started to become unbearably expensive for the Nigerian government as it spent a whopping $10 billion in 2022 just to keep the subsidy afloat. Government debt also kept increasing thereby leading to wider deficits within the government's financial records.
With the removal by President Tinubu, there is a wave of uncertainty as the price of Petrol has shot up by about 177% thus leading to increased transport prices and other commodities.
The after-effect has been heard loud and clear in some neighbouring countries like Cameroon, Benin and Togo as their black market petrol business has clearly collapsed.
Analysts have, however, said the country has saved about ₦400 billion from subsidy removal since the initial announcement was made by the President.
Bloomberg also reports that the subsidy removal and the free float of the naira will enable Nigeria to save more than ₦21 trillion ($28 billion) in two years. It also projected that Nigeria's economy would expand at 4% from 2024 if the urgently required reforms are implemented.