In a not-so-surprising development, the federal government has admitted that Nigeria, Africa’s largest oil producer, will be spending up to N5.4 trillion on oil subsidies in 2024.

This admission follows months of repeated denials by government officials who had insisted that there were no subsidies.

The revelation came during a presentation by Wale Edun, the Minister of Finance and Coordinating Minister of the Economy, on an Accelerated Stabilisation and Advancement Plan (ASAP).

The plan is designed to address key challenges affecting reform initiatives and stimulate development across various sectors of the economy.

“At current rates, expenditure on fuel subsidy is projected to reach ₦5.4 trillion by the end of 2024. This compares unfavorably with ₦3.6 trillion in 2023 and ₦2.0 trillion in 2022,” stated a draft copy of the ASAP presented by Edun.

Previously, the federal government had maintained that it would no longer subsidise fuel costs, opting instead for a deregulation policy.

In April, Heineken Lokpobiri, Minister of State for Petroleum Resources (Oil), asserted, “As far as I’m concerned, the President removed the subsidy and it remains removed till today. Anybody who is saying that subsidy is being paid, it is left for the person to bring the facts and then we will talk about them.”

Approximately four months ago, Mele Kyari, Group Chief Executive Officer of NNPCL, also denied the return of fuel subsidies. “No subsidy whatsoever. We are recovering our full cost from the products that we import. We sell to the market, and we understand why the marketers are unable to import. We hope that they do it very quickly and these are some of the interventions the government is doing. There is no subsidy,” he stated to State House Correspondents after a meeting with the President at Aso Rock Villa.

President Bola Tinubu, during his inauguration on May 29, 2023 declared that the petrol subsidy was “gone”. This latest admission, however, contradicts those earlier declarations.