The Economic Implication Of Fuel Subsidy Removal In Nigeria
This study examines the economic implication of fuel subsidy removal in Nigeria. It addresses the arguments for and against fuel subsidy removal in Nigeria as an economic discourse. This paper notes the growing antagonism from people towards the removal of fuel subsidy. It was discovered that the sector was characterized by gross corruption, abuse of office, defective record-keeping, insufficient supply, smuggling and inefficiency. The paper also examines various regimes of fuel price increases, subsidy payments and its effectiveness or otherwise in stimulating economic activities in Nigeria and make recommendations on the need to build more refineries in order to make the product more available to the people at an affordable pump price. On the short run, the prices of the fuel would go up significantly but would drop when the products of the new refineries are released into the market. Also, the paper recommends that for the smooth operation of the petroleum sub sector, government should always engage the people in policies that will affect them.
Key words- Economy, Fuel, Refinery, Subsidy