IMPLICATION OF INTENDED PETROLEUM PRICES AND NIGERIA SUBSIDY REMOVAL: A REVIEW STUDY OF 2012

Abstract

Nigeria is a country blessed with abundant human and material resources. Pre-independent Nigeria had agriculture as the major foreign exchange and revenue earner. Other resources such as revenue and minerals were explored and used to support government expenditures. Immediately oil was discovered in 1956 at Olobiri in the Niger Delta, other resources were abandoned and crude oil became the determinant of Nigeria's economic status both within and outside the country. This led this study to peruse the implications of petroleum prices and Nigeria's subsidy removal. The issue of price appropriation and removal of fuel subsidies have become controversial public policy issues. So to all successive governments. A flipover from the economy is the issue of fuel subsidy removal, which many Nigerians felt very touched about. The paper, therefore, examines the implications of subsidy removal on the economy in general and the populace in particular. To achieve this objective, the first section of the study explores conceptual issues of subsidy removal about oil deregulation. The next section examines the theoretical framework of analysis upon which the conceptual issues were based. Neo-liberalism was used in anchoring this study. The study adopted documentary research. There has been vociferous undaunted in trying to convince Nigerians to buy into the subsidy removal is the claim that the economy may crash if the subsidy is not removed. From the time the memorial government brought up the issue of removing what it’s called subsidy on petroleum products to date, feathers have been ruffled both in the National Assembly, among civil society groups, the opposition political parties, professional associations, and many other interests in the polity. Proponents of the subsidy posit that the subsidy has to go because we need the money to rebuild the economy. Opponents of the policy argued that there is nothing like a subsidy ever existed in Nigeria and that it was surreptitiously being promoted by the government as the removal of subsidy was an increase of petrol prices under a deceptive guise, which has been the basis findings of this study. The study thereby recommends corruption removal, fixing of refineries and economic diversifications in Nigeria.