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From Juliana Taiwo-Obalonye, Abuja
All Progressives Congress Presidential Campaign Council (APC-PCC) has challenged former Vice-President Atiku Abubakar to explain the legal, fiscal and operational framework of his proposed “production subsidy” for locally refined petrol, warning that the intervention could cost between N17 trillion and N21 trillion annually.
The council, in a statement issued on Sunday by its spokesman, Dele Alake, said Atiku must explain how the proposal would operate under the Petroleum Industry Act (PIA) 2021, how it would be financed and, crucially, how government support to refineries would translate into lower pump prices for consumers.
The APC-PCC’s challenge comes after Atiku reiterated his proposal for a production subsidy at a press conference in Abuja on Friday and called on President Bola Tinubu to reduce the pump prices of petrol and diesel.
The subsidy debate has returned to the centre of the 2027 political discourse after Atiku said in August that he would restore petrol subsidy if elected.
Alake said the proposal raised fundamental questions under the country’s existing petroleum laws, particularly Section 205(1) of the PIA, which provides for wholesale and retail prices of petroleum products to be determined under unrestricted free-market conditions.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), in a statement on Saturday, similarly said it did not fix petrol pump prices or issue administrative pricing templates, stressing that government intervention was restricted to exceptional circumstances involving a formally established market failure.
“Atiku should therefore explain whether a refinery receiving his proposed subsidy would be required to sell petrol at a prescribed price,” Alake said.
“If the answer is yes, he should identify the legal framework under which the government would impose that price condition and explain how it would operate consistently with the Petroleum Industry Act.
“If the answer is no, he should explain how public support to refiners would guarantee lower prices at filling stations.”
According to him, without an enforceable mechanism, refiners could receive the benefit of the subsidy while consumers continued to buy petrol at prevailing market prices.
The APC-PCC also demanded details of the proposed subsidy rate, annual spending ceiling, volume of crude or petrol to be covered, source of funding and safeguards against diversion, smuggling and fraudulent claims.
Alake said the intervention could involve supplying domestic refineries with crude at preferential prices, but argued that such a discount would reduce the value accruing to the Federation and consequently affect revenue available to the federal, state and local governments.
“Based on publicly reported refinery throughput and domestic petrol-supply figures, the cost of the new subsidy could run as high as N17 or N21 trillion annually, depending on the discount size, the volume covered, and whether the support applies to the entire barrel or only to petrol sold domestically,” he said.
He, however, said the assumptions behind the estimate needed to be clearly defined.
The APC-PCC further asked Atiku to state whether amendments to the PIA would be required to implement the proposal, arguing that an appropriation by the National Assembly alone would not resolve all regulatory questions arising from the Act.
“If Atiku intends to amend the law, he should say so plainly,” Alake said.
The council also sought to draw a distinction between Atiku’s current proposal and his previous position on downstream deregulation.
It recalled that in November 2022, at the Lagos Business School, Atiku described the petrol subsidy system as fraudulent and pledged to complete its removal.
But on August 25, 2026, Atiku wrote on X: “On the question of subsidy, my position has not changed and will not change: I will restore it!”
The former vice-president subsequently maintained that any intervention would be targeted at domestic production rather than a return to the former petrol import subsidy regime.
Alake said Atiku therefore needed to explain how the proposed arrangement would avoid what he described as the abuse, scarcity, smuggling and fiscal losses associated with the old subsidy regime.
The APC-PCC also traced the origins of downstream deregulation to the administration in which Atiku served as vice-president, noting that diesel was deregulated in June 2003 and aviation fuel subsequently moved to market pricing.
It argued that Nigeria had spent about two decades developing the PIA, with the reform process beginning in 2000, and challenged Atiku to explain how his proposed subsidy fitted into the regulatory framework that emerged from that process.
The council contrasted the proposal with the Tinubu administration’s focus on alternative energy, particularly compressed natural gas (CNG) and electric mass transit, which it said was aimed at reducing transportation costs without returning to petrol subsidies.
It cited President Tinubu’s directive following his August 27 meeting with the 36 state governors that “from October 1, more Nigerians should begin to see measurable reductions in transportation costs.”
The APC-PCC said commuters in seven states and the Federal Capital Territory were already benefiting from reduced fares on CNG and electric-bus routes, citing fares of between N50 and N100 in Borno State compared with N300 to N600 charged by commercial operators.
It also cited the Suleja-Abuja service in Niger State, where passengers pay N550 instead of about N800, and Kaduna’s free CNG buses, which it said carried more than 1.4 million passengers in five months of 2025.
According to the council, alternative-energy transport had reduced fares by as much as 50 per cent in Adamawa State, while Abia State had deployed 40 electric buses and 20 charging stations.
Alake argued that Atiku’s proposal represented a return to a subsidy-based approach and alleged that it could benefit smugglers if adequate safeguards were not established.
The APC-PCC also pointed to increased domestic refining capacity, particularly the Dangote Petroleum Refinery, as evidence of the investment it said had been encouraged by the deregulated market.
On the immediate pressure from petrol prices, however, the council acknowledged the burden on households and businesses, saying petrol had sold for about N830 per litre before the Middle East crisis pushed crude oil prices above $100 per barrel.
It said any de-escalation of the crisis could lower crude oil prices and consequently reduce petrol and diesel prices globally.
Alake added that the NMDPRA was working with the Federal Competition and Consumer Protection Commission to address alleged price-gouging and with the Nigeria Customs Service to tackle the diversion of petroleum products across Nigeria’s borders.
“Every proposed intervention in the downstream sector must be lawful, transparent, properly costed and capable of delivering measurable benefits to consumers,” he said.
The APC-PCC called on Atiku to publish a detailed policy document and an independent legal and fiscal analysis of his proposal.
“Until he does so, his production-subsidy plan remains an uncosted promise without a clearly identified legal or operational framework,” Alake said.
He further urged the former vice-president to read the PIA, saying his proposal appeared inconsistent with the current legal and market structure of the petroleum sector.
