Business

NNPC spent $10 billion on fuel subsidy in 2022

Current Logo of the Nigerian National Petroleum Corporation (NNPC)

The Nigerian National Petroleum Corporation (NNPC) spent 4.39 trillion naira ($9.7 billion) on a petrol subsidy in 2022, the latest data from the state-owned corporation showed on Friday.

Data from NNPC showed that it did not make any transfers to federation accounts in 2022, creating a void in public finances when the government was warning that low revenues and high deficits left it unable to stimulate the economy.

The subsidy is a political hotspot in Nigeria, a country of over 200 million people, and numerous governments have tried and failed to eliminate or reduce it.

Due to years of neglect, Nigeria now imports nearly all its refined fuels.

Nigeria is spending more on fuel imports than it makes from crude oil output, even though oil production has started to recover. This is due to crude theft and pipeline destruction.

Minister of Finance Zainab Ahmed has announced that the country will continue its expensive but popular petrol subsidy until mid-2023, allocating 3.36 trillion naira ($7.5 bln) for the programme.

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