The Presidency has rejected former Vice-President Atiku Abubakar’s call for a production subsidy on crude oil supplied to local refineries, arguing that a similar policy was tested during the Olusegun Obasanjo administration and produced poor results.
Senior Special Assistant to President Bola Tinubu on Digital and New Media, Otega Ogra, made the comments in response to Atiku’s recent proposal. Atiku had advocated a subsidy that would lower the cost of crude for domestic refiners rather than continue subsidising imported petroleum products.
In a post on X, Ogra stated that Nigeria had already implemented the approach while Atiku served as Vice-President. “Excuse me, sir. Nigeria already tried your production-subsidy to local refineries idea while you were Vice President. We know the shambolic results of that production subsidy. You know it too,” he wrote.
Ogra cited official utilisation figures from the period to support his position. The Warri Refining and Petrochemicals Company operated at 14.27 per cent capacity in 2003 and 9.1 per cent in 2004. The Kaduna refinery recorded 15.96 per cent and 26 per cent utilisation in the same years. Port Harcourt’s utilisation rate fell from 60.73 per cent in 2001 to 31.04 per cent in 2004.
He further noted that petrol prices more than tripled by 2004 and nearly quadrupled by the end of the administration, despite the subsidy. According to Ogra, the arrangement was cancelled on 9 October 2003 through Presidential directive PRES/158. President Obasanjo then ordered the Nigerian National Petroleum Corporation to pay the full international price for crude supplied to the refineries.
“President Obasanjo ordered NNPC to pay full international price for refinery crude. Your production subsidy was tried, failed and scrapped, with you as Vice President,” Ogra said.
He challenged Atiku to present evidence that the earlier policy had achieved its goals. “So, before selling Nigerians this failed production subsidy policy again, answer one simple question… where is the evidence that it worked the first time?”
Ogra concluded that Atiku’s current proposal is essentially a repeat of the previous approach. “It’s still the same theory you practiced then, and we haven’t changed country yet. One thing we already have, are the failed results of that experiment, Alhaji.”
