Nigeria fuel subsidy: Tinubu's plan to scrap measure sparks rush to stock up

The first full day in power of Nigeria's new president has seen people panic-buying fuel following an announcement to scrap a decades-long subsidy on petroleum products. 

Bola Tinubu declared the subsidy to be "gone" in his inaugural speech on Monday.

But he provided no timeline or other information about this significant policy shift.

His staff explained on Tuesday that he meant the end of June and that the panic buying was "needless" because the policy will not go into action right away.

In order to relieve strain on the government's budget, President Tinubu wants to withdraw the subsidy, but doing so will raise the price of gasoline and have a negative impact on other costs at a time when inflation is already high.

In response to his remarks from Monday, numerous gas stations increased their prices while others completely stopped selling.

The single importer of petroleum products into Nigeria, the state-owned oil firm reassured the populace that it had sufficient supply.

Though most people were afraid of a sharp increase in the price of gasoline, which should be supplied at the regulated price of 185 naira per litre (32p, 40c), this did not stop frantic buying.

Videos of gas stations raising prices—in some cases by more than 200%—have been posted online by some people.

Many Nigerians rely on private buses to go around, but some of those drivers have reported having trouble filling up their cars.

People are now stranded at important bus stops in the nation's capital, Abuja, and its largest city, Lagos.

Nigeria has a lot of oil, but it cannot refine enough crude to meet local demand, so it imports petroleum products, which are then sold at a price established by the government.

However, the subsidy significantly depletes public funds. It consumed 4.3 trillion naira ($9.3 billion; £7.5 billion) last year, and 3.36 trillion naira was planned for it in the first half of this year.

On Monday, Mr. Tinubu declared that the situation was no longer justifiable and that the money would instead be used to build public facilities and enhance people's quality of life.

However, a lot of Nigerians have long viewed the subsidy as one of the few benefits they get from the government.

In response to widespread opposition to the previous removal effort in 2012, President Goodluck Jonathan had to change his position on the matter.

So far, a significant group of companies that sell petroleum goods has publicly stated that it opposes President Tinubu's plan. It advised starting a conversation before making a decision by the incoming administration.

According to Ukadike Chinedu, spokesman for the Independent Petroleum Marketers Association of Nigeria, the decision will "cause galloping inflation and inflict more hardship on the masses."

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