Nigeria Moves to Avert Fuel Crisis with Pledge to Settle IPMAN’s N100bn Bridging Claims, But It Reignites Subsidy Debate

The debate on Nigeria fuel subsidies resurfaced with a renewed intensity following the last -minute intervention of the federal government to prevent an imminent strike from the Independent Association of Oil Marketing in Nigeria (IPMAN).

The crisis was triggered by the government’s failure to pay 100 billion nairas in the ongoing bridging complaints, a situation which threatened to disrupt the supply of fuel across the country. Although the government’s commitment to settle the debt has temporarily disseminated tensions, it also attracted new control on the question of whether the fuel grant – declared unofficially abolished in May 2023 – was in fact removed or simply prosecuted under a different name.

The controversy broke out when IPMAN published a seven -day ultimatum on February 24, 2025, demanding that Nigeria Midstream and the downstream oil Regulatory Authority (NMDPRA) govern long -standing bypass complaints due to petroleum marketers. The association warned that the fact of not making payment would result in a national level of petrol supply, an action that could have plunged the country into another crisis of rarity of fuel.

While the deadline is looming, the government has quickly pushed the situation. On February 27, 2025, IPMAN National President Alhaji Abubakar Maigandi announced that the government had provided payment marketing specialists and expressed its commitment to solving other current problems in the sector. He called on members to stay patient and suspend any planned industrial action while discussions with the NMDPRA continued.

“We were in communication with the NMDPRA and the Federal Ministry of Petroleum Resources. They expressed their commitment to deal with these complaints in instance and other questions.

“In the meantime, we implore with kind all members to stay calm and patients while we are working to ensure the necessary approvals and payments.

“We understand the importance of these claims and appreciate your understanding during this process.

“We also encourage all members to refrain from any action that could disrupt our collective efforts, including strike actions.

“Our next official meeting with the NMDPRA will be an essential opportunity to discuss more of these questions, and your participation will be invaluable,” he said.

However, the episode has raised more in -depth concerns concerning the true status of the fuel subsidy policy of Nigeria. The very existence of unpaid bridging complaints suggests that the government always subsidizes the distribution of fuels, contradicting its previous position according to which subsidy payments had been completely abolished.

The controversy of the deletion of subsidies

When President Bola Ahmed Tinubu assumed his duties in May 2023, he announced an immediate and total withdrawal of the fuel grant, a long -standing policy that had drained government finances and favored ineffectures in the petroleum sector. This decision was largely considered to be a daring economic reform aimed at reducing public spending and attracting investments in the private sector in the import and refining of fuel.

However, the decision came with serious economic consequences. The fuel prices tripled overnight, from N185 per liter to more than N500, then exceeding N600 per liter in several states. The net increase led to an inflationary spiral, with the cost of transport, food and essential products. The frustration of the public rose and the unions organized multiple demonstrations, arguing that politics had pushed millions of Nigerians more deeply into poverty.

While the pressure intensified, the government introduced the palliative to amortize the impact, including cash transfers to vulnerable households and salary adjustments for civil servants. However, these interventions have not prevented the widespread economic difficulties. In the midst of growing dissatisfaction, the government has quietly resumed fuel subsidies under a different appearance, despite the publicly insistence at the end of the subsidy regime.

Subsidies disguised as “price stabilization”

Although fuel prices should fluctuate with world crude oil prices and exchange rate movements after the elimination of grants, this was not the case. Analysts noted that despite the depreciation of Nairas and the increase in international crude prices, the prices of petrol in Nigeria remained artificially low – a clear indication that the government always subsidized fuel behind the scenes.

The clearest proof of this came from Nigerian National Petroleum Company Limited (NNPCL), which has kept control of fuel imports even after the withdrawal of subsidies. At the beginning of 2024, the experts estimated that without any subsidy, the price of the real petrol market should have exceeded 1,000 N per liter. However, the government assured that the prices remained in the N600 range at 700, effectively covering the cost difference, as was during the official era of the subsidy.

Pontage complaints of 100 billion nairas due to IPMAN also confirm the continuous existence of subsidies. Pontage complaints are transport subsidies intended to equalize fuel prices in different regions, ensuring that consumers in remote areas pay the same price as those of urban centers. If the government had really eliminated the subsidy, there would be no reason to maintain these payments. However, as this crisis has shown, the government remains indebted to marketing specialists, proving that fuel prices are always manipulated by indirect subsidies.