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Tag: Petrol subsidy

  • Ex-EFCC chair Bawa: how petrol subsidy fraud was perpetrated

    Ex-EFCC chair Bawa: how petrol subsidy fraud was perpetrated

    A former Chairman of the Economic and Financial Crimes Commission (EFCC), Abdulrasheed Bawa, has given an insider narrative on how petrol subsidy fraud was perpetrated.

    In his groundbreaking new book, titled: The Shadow of Loot & Losses: Uncovering Nigeria’s Petroleum Subsidy Fraud, published by CableBooks, an imprint of Cable Media & Publishing Limited, Bawa unravels the inner workings of one of the country’s most pervasive financial crimes.

    The strategies, he writes, include ghost importing and over-invoicing; submission of claims for fuel that was never imported; inflated shipment volumes to receive excessive subsidy payouts; manipulation of bills of lading by altering shipping documents and fraudulent exploitation of international price fluctuations to claim higher subsidies.

    Others are: round-tripping and double claims; using single shipments to obtain multiple subsidy payments; diversion and smuggling; and diversion of subsidised fuel to black markets or smuggling for high profit.

    Bawa, in a statement by Vic Akinrogunde, said the book is a powerful exposé that provides the most authoritative account yet on Nigeria’s multi-trillion naira fuel subsidy scandal.

    Drawing from his firsthand experience as a key investigator on the EFCC’s special team that probed the 2012 subsidy fraud, Bawa reveals the staggering scale, complexity, and audacity of the schemes used to siphon public funds under the guise of fuel subsidy payments.

    His insider narrative chronicles how billions of naira were recovered and several culprits brought to justice, while also shedding light on how entrenched corruption allowed the fraud to flourish for years.

    These practices, Bawa explains, were enabled by forged documents, weak regulatory oversight, and systemic collusion between corrupt government officials and private sector actors.

    “The ‘Shadow of Loot & Losses’ is not just a chronicle of fraud,” Bawa said.

    Read Also: Ghana High Commissioner to Nigeria Bawa is dead

    “It is a call to action — a demand for transparency, accountability, and reform in Nigeria’s public finance management, especially in the oil sector.”

    Having served as EFCC chairman from 2021 to 2023, Bawa brings a rare credibility and insight into the institutional challenges and political dynamics that have shaped the anti-corruption fight in Nigeria.

    The statement said the book is both a revelation and a reckoning, offering evidence-based analysis and personal reflections on one of the most controversial chapters in Nigeria’s recent history.

    “The book is essential reading for policymakers, civil society advocates, journalists, and citizens interested in understanding how systemic fraud undermines development and how it can be confronted,” the statement added.

  • I inherited N600bn debt owed to marketers of PMS – Kachikwu

    I inherited N600bn debt owed to marketers of PMS – Kachikwu

    Cheap petrol is coming, Minister of State for Petroleum Resources Dr. Ibe Kachikwu predicted yesterday.

    His forecast is based on what he described as the competition inherent in the Premium Motor Spirit (PMS) price modulation.

    He said the price of diesel, which is now 40 per cent down amid surplus supply, was enough evidence that petrol prices will also crash. Petrol is N145 per litre.

    Presenting his scorecard on his two years in office in a podcast released to reporters in Abuja, Kachikwu said that “once Nigerians throw their trading skill in it, once competition thrives, the prices will continue to tumble.

    “My guess is that you will see the prices tumble in the next four, five to six months. The market will be more stable and definitely, the prices will be lower than what we see today.”

    Besides, said the minister, in the last 10 years, this is the first time that the three refineries are working simultaneously, although at 50 per cent of their capacity.

    “We expect to put in investment to put them to 90 per cent capacity,” he said.

    According to Kachikwu, this is the first time the NNPC group has recorded savings, which could be used to address the refineries alongside the Joint Venture Partners.

    The minister noted that this is the first time the government has upgraded the depots. Of the 19, only three are grounded.

    He said this is the first time that a government is considering the replacement of the 35-year-old pipelines.

    “It has been one massive problem after the other for the sector to stabilise in term of product supply.

    To Kachikwu, “the time has come to take on the problem bullishly and that is what we are trying to do”. “So, we believe the ire will be money for infrastructural development in the downstream sector”, he said, adding:

    “We believe that a lot of the companies will jump up now and be able to sell at the right prices and not the pump down by the problem of price control and will be able to grow their businesses. We believe that most of them, efficient ones will drive prices southward rather than northward.

    “And we believe that almost 200,000 jobs will be created in this sector and over 400,000 jobs will be saved, which would have been lost if we had continued on the path we were in.”

    On the assumption of office two years ago, Kachikwu said, he inherited a debt of N600billion owed to marketers of Premium Motor Spirit (PMS), which the Federal Government settled.

    His words: “Now, why do we have to do this? The first one is that when we came into position in August, last two years, about  N600billion was owed to marketers. And all of them basically ceased importing products.

    He spoke of how he lifted Nigerians from the pains of the scarcity of the Premium Motor Spirit and its concomitants queues.

    He noted that the product was scarce because its selling price was higher than its cost price, hence the removal of the Petrol Support Fund (PSF), also known as petrol subsidy.

    Kachikwu said: “ I know that a lot of you watched as we moved price from N86.50; you to N145 were screaming where were we heading ?”

    According to him, there would have been no better time to accomplish the feat other than in the administration of President Muhammadu Buhari, who is trusted enough to utilise the benefits from PMS for the betterment of the country.

    This, according to him, upon the removal of the subsidy, the marketers were reluctant to import the product owing to their lack of access to forex.

    He said the government had no money from crude oil following the reduction in production as the militants were on rampage .

    The minister said: “The reality was that we did have the barrel to throw at it; we didn’t have the refineries . The Federal Government was bleeding. The production today is about 1.4  because the militants attack had taken away about 800,000 barrels per day. Once you do not have the barrel, foreign exchange does not come in.

    “So foreign exchange was depleting and the question was what did we do with the foreign exchange we had.

    “And the President made the right choice to leave what we have intact so that we do not run into a state of bankruptcy. The only option we had was to create a liberalised environment so that people can bring in their products, source their money from secondary markets, charge the right price, which they would not do unless the price was high. Fellow Nigerians, we were left with no option than what we did.”

    According to Kachikwu, the refineries were not working but as soon as the government was able to revamp, the 445 barrels per day was sent to the refineries

    He noted that the situation culminated in almost making the Nigerian National Petroleum Corporation (NNPC) the sole importer of PMS instead of its statutory provision of 55 per cent.

  • NEITI report: Govt spent N1.3tr on petrol subsidy in 2013

    NEITI report: Govt spent N1.3tr on petrol subsidy in 2013

    The Nigeria Extractive Industries Transparency Initiative (NEITI) yesterday recommended that the Nigerian National Petroleum Corporation (NNPC) and its subsidiaries should refund the total outstanding payments of $3.8 billion and N348.3 billion revenues to the Federation Account.

    It said the federal government spent N1.3trillion on petrol subsidy in 2013.

    According to the report, N1.3 trillion was processed as subsidy payments for NNPC and independent marketers in 2013.

    The report revealed that no remarkable progress has been made on the implementation of enhanced measurement arrangements for both downstream and upstream hydrocarbon flows.

    The absence of metering and crude measurement has very serious implications for federation revenue, it said.

    These are part of the NEITI audit report for 2013 made public yesterday in Abuja by NEITI’s National Stakeholders Working Committee (NSWC) board chairman Dr. Kayode Fayemi, who is also the Minster of Solid Minerals.

    The outstanding payments, according to its 2013 Oil and Gas Audit Report: “were due from unpaid consideration from the divested Operation Mining Leases (OMLs), cash call refunds from NAPIMS, and the NPDC liftings from NOAC (Agip) JVC.”

    The report added that there were $5.966 billion and N20.4 billion as revenue losses to federation account, which were due to Offshore Processing Arrangement, crude theft, and others.

    It stressed that there were $599.98 million as under-assessments/under-payments of petroleum profit taxes and royalties by oil and gas companies as a result of the use of different pricing mythology by the government and companies because of the absence of a new fiscal regime.

    The report revealed that Nigeria Liquefied Natural Gas (NLNG) paid the sum of $1.289 billion as dividends, interest and loan repayment for 2013. NNPC acknowledged receipt of this amount but did not remit it to either the Federal Government or the Federation.

    According to the report, the sum was part of the total amount that the corporation is requested to refund to the federation.

    It added: “However, it is important to also note that the 2013 figure brings to $2.9 billion the total NLNG payments received by NNPC between 2005 and 2013 but not remitted by NNPC to the Federal Government or the Federation.”

    He also urged the Federal Government to conduct a comprehensive investigation into the divestments of Federation assets by the NNPC to NPDC.

    The report recommended that the corporation should invoice gas payments in dollars instead of Naira to avoid exchange losses.

    It said that a scientific technology such as finger-printing should be put in place to track Nigeria’s oil trade to check oil theft.

    The report urged the government to quickly resolve the issue of pricing methodology by enacting appropriate law to forestall under assessments of the Petroleum Profit Tax (PPT)/royalty.

    It said “NNPC should discontinue alternative importation arrangements and limit itself to export of crude and import of refined products.”

    In terms of crude oil production and liftings, the report disclosed that 800,488,000 barrels were lifted which was 150,000 barrel lesser than the 800,338,000 that was lifted in 2012.

    On revenue, the NEITI report said that “the total revenue flows to the federation from all sources in 2013 came to $58.07 billion. This included revenues from crude oil sales, taxes royalties and other incomes. The revenues realized in 2013 represented a decline of 8% when compared with the $62.9 billion realized in 2012. This decline was attributed to the drop in oil and gas sales following divestment of federation equity in some OMLs crude losses as a result of destruction of production facilities, pipeline vandalism and crude oil theft.”

    ‘Solid minerals revenue hit N33.86b in 2013’ 

    A total of N33.86 billion accrued to the federation from solid minerals sector in 2013, according to the 2013 Solid Minerals Audit Report of the Nigeria Extractive Industries Transparency Initiative (NEITI), made available yesterday.

    NEITI’s National Stakeholders Working Committee (NSWC) board chairman, Dr. Kayode Fayemi, made public the report in Abuja.

    NEITI said 619 entities made payments to the government in 2013, but the 2013 solid minerals audit reconciled payments by only 65 entities which were 63 companies and two buying companies that made payments of N2 million and above.

    The 65 companies, said the report, were 10.5% of the 619 and accounted for 90.49% of the total payments for 2013.

    It submitted that six government agencies were covered by the audit.

    The report however said that out of the revenue, payments from cement manufacturing companies accounted for N30.47 billion, construction companies N1.98 billion, mining and quarrying companies N4.19, representing 89.98%, 5.%, and 4.19% respectively.

    It noted that the revenue distribution among government agencies showed that N28.954 billion was collected by Federal Inland Revenue Service (FIRS), by Mines Inspectorate Department (MID) and N704 million by Mining Cadastre Office (MCO).

    NEITI said that “unilateral disclosures by companies not reconciled in the audit scope came to N2.861 billion while N748 million was reported as unilateral disclosures by government entities. Revenues from solid minerals rose by 7.6% from N31.5 billion in 2012 to N33.9 billion in 2013.”

    According to the report, payments from the solid minerals sector were not “dispersed” as five companies accounted for 93% of reconciled payments. It noted that the companies were Dangote Cement 53%, WAPCO 19% , Ashaka Cement 10% UNICEM 7% and CCNN 4% .

    NEITI said that five states accounted for 72% of the total payment for solid minerals in 2013, and that they were Ogun 25% , Kogi 20%, FCT 14%, Cross River 9% and Oyo 4%.

    The report highlighted that there were lack of clarity on legal and tax regime in the sector.

    It stressed that there was inaccuracy of data and absence of transfer of states and local government areas. The report added that there was inaction on previous audit reports.

    In its recommendations, the reports said that “the N2 billion that accrued from the solid minerals sector in 2013 should be shared to states in accordance with Section 1 of the Federation Accounts Act 1982 and the 13% derivative formula.”

    The report urged government to develop procedures and systems to collect and verify production data declared by companies.

    NEITI asked government to review the tax reporting system and put in place a sector- specific fiscal regime for the country that could improve controls over sector revenues, transparency and traceability of income.

    The report requested that the country take advantage of the huge opportunities for jobs, growth and diversification offered by the solid minerals sector.

  • Petrol subsidy claims rise to N521b

    Petrol subsidy claims rise to N521b

    •Ministers defend budget before Senate
    • CBN grants BVN waivers to soldiers on battle front

    The controversial fuel subsidy claims as contained in the 2015 Supplementary Budget presented to the National Assembly by President Muhammadu Buhari has risen from N413 billion to N521 billion.

    The original N413 billion subsidy claim included N120.552billion outstanding claims from 2014 and N292.8 billion to cover claims from January to September.

    But Permanent Secretary, Ministry of Petroleum Resources, Mrs. Jamila Soara, who represented the Minister of State, Dr. Emmanuel Ibe Kachikwu, told the Senate Committee on Appropriation that is considering the Supplementary Budget that another N108 billion will be required to cover fuel subsidy for October to December.

    The permanent secretary told the committee that Kachikwu was in Lagos trying to convince major oil marketers to start importing products.

    Major oil marketers import 52 per cent; PPMC imports 48 per cent for local consumption.

    She noted that the issue of subsidy payment was being handled by the Federal Government.

    Asked why the supplementary oil subsidy budget did not cover October to December, Mrs. Soara said her ministry had drawn the attention of the Budget Office to the fact that the proposal for the last quarter had not really been captured.

    The outstanding subsidy claim for October to December, she said, is N108 billion.

    The N108 billion increment will shoot up the supplementary budget proposal earlier submitted to the National Assembly from N465.69 billion to N574 billion.

    Minister of Budget and National Planning, Senator Udoma Udo Udoma, led other ministers to a budget defence.

    The committee asked the Ministries of Petroleum, Finance, Budget and National Planning to reconcile the supplementary budget to capture the N108 billion required to cover subsidy claims for October, November and December.

    Committee members   frowned at what they described as “half measure approach to fuel subsidy crises in the country”.

    The chairman, Senator Danjuma Goje, expressed dissatisfaction with the way the ministry is treating the subsidy issue.

    Goje said: “It is obvious that there is no synergy between the Budget Office and the Petroleum Ministry.

    “Why is it that we have to leave three months in a year without making provisions for the subsidy?

    The committee wondered why N413 billion would be provided for the payment of subsidy claims to oil marketers while nothing was provided in the supplementary budget for the payment of subsidy claims to NNPC.

    The committee noted that the apparent deliberate omission would create a loophole likely to be exploited by the NNPC to source its subsidy claims directly from the money it generates.

    A member of the committee, Senator Bassey Albert Akpan, asked: What is the subsidy due to NNPC?

    “It appears that the difference between this figure we got through intelligence report and what you have submitted as due to major oil marketers is the one due to NNPC.

    The Accountant General of the Federation, Ahmed Idris, who was at the budget defence, said about N274.290 billion of the N557.378 billion capital budget for 2015 had been released.

    He said: “The capital budget, which is the main focus of the committee, we appropriated N557.378 billion out of which we made releases to agencies.

    “First quarter, we released N112.039 billion, second quarter N88.792 billion.

    “There were also some capital supplementation amounting to N73.459 billion. In total, what has been released so far is N274.290 billion.”

    The Minister of Defence, Musa Dan Ali, who came with some service chiefs, told the committee that the Chief of Army Staff, Maj. Gen. Tukur Burutai, could not attend the meeting because he travelled to Yola, Adamawa State, where there was an insurgency attack on Sunday.

    The Chief of Air Staff, Air Vice Marshall Abubakar Sidique, he said, was in Pakistan, where he is attending a seminar in air operations.

    The minister added: “I appreciate the immense support by the National Assembly in the fight against insurgency

    “To achieve the desired result, additional funding is required.

    “The sum of N29,958,865,912 is appropriated for operation Zaman Lafia Dole.

    “N17,468,992,649 is meant for operational allowance and cash allowance for soldiers on the field.

    “We have also requested for N8,141,434,769 for logistics support of the Air Force.

    “We also have an outstanding balance from the 2015 budget, for the second quarter, which amounts to N4,348,129 billion.

    “Another salary amount is requested because of the recent recruitment to make up what we have in the field.

    “We require N1,987,956,475 as well as additional salaries for soldiers who were not included last year and the short officers commanding the soldiers who were recruited, amounting to N420,365,830.

    “As partners in progress against insurgency, I pray this Senate to approve  N29,958,865,512 for operation Lafia Dole and other outstanding bills.”

    The minister also noted that the essence of the deadline given to the military to end insurgency was just a time line.

    He said the fight against insurgency is in phases.

    According to him, “the first phase, which we have achieved, was to clear the insurgents from taking hold of any part of our country.

    “Fighting insurgency cannot be achieved within a day. All we are working for is to ensure maximum security in our country.”

    The minister requested the committee to persuade the Central Bank of Nigeria (CBN) to grant waiver to soldiers on the field concerning BVN registration.

    He said: “Majority of our staff on the field cannot access their money due to lack of BVN.

    “I wish the Senate can assist us so that soldiers can get extension through the CBN as the families of our soldiers are suffering.”

    Goje urged the CBN to grant extension to Armed Forces, especially those on the war front so that their families do not suffer.

    CBN Deputy Governor (Operations) Suleiman Barau told the committee that the Apex Bank had approved the request.

     

     

  • Past governments caused fuel subsidy woes – Buhari

    Past governments caused fuel subsidy woes – Buhari

    President Muhammadu Buhari on Tuesday blamed past administrations for the current situation in which Nigeria is forced to spend billions of Naira annually on alleged subsidies for petroleum products.

    He spoke during a closed-door meeting with the Chairman and members of the Revenue Mobilisation, Allocation and Fiscal Commission (RMAFC) at the Presidential Villa, Abuja.

    Buhari, according to a statement issued by his Senior Special Assistant on Media and Publicity, Garba Shehu, said the escalation of petroleum subsidy payments over the recent years was due to the deliberate neglect of the nation’s refineries, oil pipelines and other related infrastructure in order to allow the importation of petroleum products and for corruption to thrive.

    The President, who restated his huge disappointment with the way Nigeria’s oil industry has been run since he left office as Petroleum Minister and Military Head of State, said he was convinced that if the development of the country’s domestic refining capacity and petroleum products distribution network had kept pace with national demand, there would not have been any need for the huge subsidies currently being paid to importers.

    “They allowed the infrastructure to collapse so that their cronies can steal by bringing in refined products from overseas,” President Buhari said.

    The President urged the chairman and members of the RMAFC, who availed him of their view on the vexed issued of petroleum subsidy payments, to go “back to the drawing board” and come up with  more humane proposals to rescue ordinary Nigerians from the “wicked manipulation” of the country’s oil industry by corrupt operators.

    President Buhari also warned that severe sanctions will be visited on any individual or organisation that violates the directive on the payment of all national revenue into the Federation Account.

    He said the Nigerian National Petroleum Corporation, the Nigerian Ports Authority and other MDAs which previously relied on the laws establishing them to retain all or part of revenues collected by them, did so illegally and must now comply with the Nigerian Constitution by paying all revenues to the Federation Account.

     

     

  • Petrol subsidy booby trap for Buhari in Budget 2015

    Petrol subsidy booby trap for Buhari in Budget 2015

    The stage seems set for a major controversy in the polity, with the passage yesterday of the 2015 Appropriation Bill.

    There is no provision for fuel subsidy in the N4,493,363,957,158 estimates approved by the House of Representatives.

    The budget has a recurrent  (non-debt) expenditure of N2.607, 132,491,708.

    Last year, N971.1b was spent on fuel subsidy – same as in 2013.

    The N701, 415,465,449 capital expenditure was broken into N556, 995,465,449 for Ministries, Departments and Agencies (MDA) and N144, 420,009,000 for statutory transfer.

    The budget is N67,433,759,158 higher than the N425,425,930,000 stated in the report that was laid on Wednesday by the joint Chairman, Committees on Appropriations and Finance, John Enoh.

    Speaking on the removal of fuel subsidy, Legislative Budget and Research Committee Chairman  Opeyemi Bamidele said it was a booby trap set for the in-coming Muhammadu Buhari administration.

    According to him, the silence over the removal is capable of setting off the new government on a wrong footing.

    He said: “With the withdrawal of fuel subsidy, Nigerians must be educated, else they would be sending Nigerians a wrong signal capable of creating the impression that APC either deceived Nigerians to get their votes or had reneged on its electoral promise as a progressive party.

    “The truth and reality of the situation is that the outgoing PDP administration has, through the 2015 budget, removed oil subsidy and it must be made to accept responsibility for it rather than for the incoming APC administration to bask along in the euphoria of having won an election without realizing the booby trap into which they and the Nigerian people are walking into”.

    While expressing fears over possible reaction from Nigerians, Bamidele said it was imperative for Nigerians to know who to hold responsible for the development.

    “For the record and for posterity purposes, I am opposed to this sudden removal of fuel subsidy and I implore Nigerian patriots to be aware.

    “The political economy of this development and its grave implications must not be lost on all stakeholders. This is more so when a new ruling party is coming into power by May 29, 2015.

    “To my mind, this is definitely a booby trap for the incoming administration of Gen. Muhammadu Buhari and I hope the All Progressives Congress (APC) as the incoming ruling party will understand the full implications of this and take immediate steps to let Nigerians know where it stands on this matter.

    “This is a serious development and a defining moment that calls for the attention of all well meaning Nigerians at home and abroad.

    “This is the first time in the last 16 years of our civilian rule that a new political party will be taking over to form a government.

    “If care is not taken, this matter is capable of making the incoming government morally dead on arrival, except the issues are promptly dealt with in a way that the critical stakeholders, including the civil society, corporate Nigeria, political class and the generality of Nigerians will know the true state of affairs,” he warned.

    The budget that scaled third reading after it was passed at the Committee on Supply, chaired by Speaker Aminu Tambuwal, was raised by N135.4b to N4.493trn from the N4,357,960,000,000 proposed by the Executive in November 2014.

    Niger Delta Development Commission’s allocation was raised from N45.780b to N46.720b; Universal Basic Education’s allocation went up from N67.3b to N68.380b; National Assembly’s allocation was raised from N115b to N120b; Public Complaint Commission’s allocation climbed up from N2b to N4b and National Human Right Commission’s allocation was raised from N1.2b to N1.516b.

    The breakdown of the final amount passed showed that N375.616b is for statutory transfer while the N953.620b for debt service was N894,610,009,000 for domestic debt and N59,010,009,009 for foreign debt.

    Under recurrent (non-debt) expenditure, Education got the highest allocation of N392,363,784,654, followed by Defence/MOD/Army/Air Force/Navy with N338,697,219,431. Police formation and Commands got N303,822,224,611 and  N237,075,742,847 is for Health sector.

    In the budget, N69,423,427,479  was allocated to Youth Development; N62,226, 771,999 for office of the National Security Adviser; N58,247,429,975 (Petroleum Resources); N48, 389,942,264 (Secretary to the Government of the Federation); N41,649,382,166 (Foreign Affairs) and N31,869,020,717 (Agriculture and Rural Development).

    Science and Technology got  N25,593,880,816; Works (N25,173,916,543); Information (N23,682,420,241); Presidency (N20,085,865,120); Tourism, Culture and National Orientation (N18,018,478,935); Environment (N15,599,334,341); Trade and Investment (N10,941,859,480) and while Communication Technology (N10,592,048,381).

    From the N13,965,664,092 approved for the eight Federal Executive bodies, N5,293,800,054 is for the National Population Commission; N1,935,767,344 is for the Code of Conduct Bureau; N493,656,088 (Code of Conduct Tribunal); N2,207,213,456 (Revenue Mobilisation Allocation and Fiscal Commission); N1,125,005,114 (Federal Civil Service Commission); N740,477,185 (Police Service Commission) and N2,167,931,068 (Federal Character Commission).

    Also, N354,335,011,023 was approved for  Service Wide Votes with N20.170b allocated to Operation Zaman Lafiya; N22b is for operations – Internal for the Armed Forces; N9.6b is for payment to Nigerian Army Quick Response Group, including arrears; N5b is for payment of outsourced services; N2.3b is for entitlements of former Presidents/Heads of State and Vice Presidents/Chiefs of General Staff; N5.5b is for Employees Compensation Act – Employees Compensation Fund; N17.5b is for General Elections logistics support; N17,397,993,277 is for Contingency; N6b is for country’s contribution to West African Examinations Council (WAEC); N4.5b is for assessed contribution to African Union and others; N6,099,600,000 is for margin for increases in costs; N9.5b is for external financial obligations; N3,099,600,000 is for recurrent adjustment; N38,987,017,746 is for public service wage adjustment for MDAs (including arrears of promotion and salary increases) while N11.755b is for improved remuneration package for Nigerian police.

  • FG ‘plans’ petrol subsidy cut in 2015

    FG ‘plans’ petrol subsidy cut in 2015

    Nigeria plans to cut subsidy on petroleum products by half next year after sharp falls in global crude prices, spurred the government to revise its 2015 budget downwards, data from the revised budget proposal has revealed.

    President Goodluck Jonathan submitted the revised budget figures to National Assembly this week, proposing to spend 458.68 billion naira ($2.59 billion) on petrol subsidy in 2015, down from 971.14 billion naira presented for 2014.

    It also assumed further cuts to petrol subsidies in 2016 to 408.68 billion naira and 371.18 billion naira for 2017.

    The country’s finance minister has proposed lowering the assumed benchmark oil price for the country’s 2015 budget to $73 per barrel from the $78 proposed in September, after global crude prices collapsed.

    Ngozi Okonjo-Iweala told Reuters on Thursday that declines in the price of oil, which has lost almost 30 percent since July, would impact Africa’s largest economy and top oil producer, requiring the government to cut non-essential spending and raise more revenues.

    Nigeria tried to end subsidy in 2012 in efforts to cut government spending and encourage badly needed investment in local refining, doubling the price of a litre of petrol overnight to about 150 naira ($0.93) from about 65 naira.

    The move angered citizens, who see cheap petrol prices as the only benefit they derive from living in an oil-rich country, and lead to eight days of nationwide strikes. The government later reinstated part of the subsidy to end the strikes.

    The budget proposals, according to Reuters, assumed an exchange rate of 162 naira to the U.S dollar for 2015, weaker than 160 naira assumed for 2014. It expects the naira to weaken further to 163.50 in 2016, reaching 165 in 2017.