Removal of Fuel Subsidy is Necessary for Long-Term Energy Security – Tinubu

The President said this in his keynote address at the opening ceremony of the 7th Nigerian International Energy Summit (NIES) at the Banquet Hall of the Presidential Villa, Abuja

President Tinubu, represented by the Minister of Information and National Orientation, Alhaji Mohammed Idris said  that petroleum subsidy had, over the years, strained the country’s economic resources, leading to inefficiencies and, most importantly, hindering ability to invest in critical areas of energy security.

The President who admitted that the decision to remove the petroleum subsidy was a challenging one, however stressed that it was a step that must be taken to secure Nigeria’s energy future and foster economic growth.

President Tinubu said that by removing subsidy, “We are creating a more transparent and accountable energy sector. The funds that were previously allocated to subsidising petroleum products are now redirected towards developing and upgrading our energy and other social infrastructure”. 

He further said, “While we are immersed in energy security, let us not forget that Energy Transition is another key aspect of our discussions. We stand on the brink of a new era, where traditional energy sources are being complemented and in some cases, replaced by cleaner and more sustainable alternatives. This transition is not only an environmental necessity but also an economic opportunity. We must leverage innovation and collaboration to ensure a smooth and just transition that will leave no one behind”. 

Highlighting some of the gains of the removal of the subsidy, the President said “the private sector has been encouraged to participate in the energy industry with potential of attracting more local and international investors, fostering innovation and competition that will drive down costs and improve the overall efficiency of our energy sector.”

Also speaking at the occasion,l in his opening remarks, the Permanent Secretary, Ministry of Petroleum Resources, Amb. Nicholas  Agbo Ella said, “The global energy landscape is undergoing a transformative shift, and it is imperative that we collectively address the challenges and opportunities that come with this new order. Through thoughtful discussions, insightful panels, and robust deliberations, we aim to chart a course that ensures the security of our energy resources, facilitates a smooth transition towards sustainable practices, and addresses the financial dynamics of the sector”

In his message, the Secretary-General, Organisation of Petroleum Exporting Countries (OPEC), H.E. Haitham Al Ghais, said, Nigeria’s role in OPEC’s past and present was a tremendous source of pride.

He added that OPEC was also acutely conscious of Nigeria and Africa’s critical role in the future of our organization and the energy industry more broadly.

 Al Ghais acknowledged the  contributions of  successive generations of Nigerian public servants and captains of industry in making the OPEC-Nigerian relationship a success.

The Secretary-General of African Petroleum Producers Organization (APPO), Dr. Omar Farouk Ibrahim, in his message said, the decision on which country, the proposed African Energy Bank will be sited is to  be taken by the end of the first quarter of 2024, adding that  seven countries including Nigeria are jostling for it.

Dr. Omar Farouk further said that the bank is expected to take off not later than the end of the first half of 2024.