President Bola Tinubu
The Presidency has dismissed claims linking recent fuel price reductions to the return of subsidy, insisting that a margin discount by fuel marketers is different from a government-funded subsidy.
In a statement shared by the Special Adviser to the President on Information and Strategy, Bayo Onanuga, the Presidency urged the African Democratic Congress (ADC) and the National Democratic Coalition (NDC) to properly understand the difference between a marketing discount and a subsidy.
It said, “The ADC and NDC should carefully re-read this ministerial brief: Margin Discount and a Subsidy Are Not the Same.”
The Presidency explained that every fuel marketer adds a profit margin to the cost of the products they sell.
It stated, “Every marketer adds a margin to the price it pays for the fuel it sells. A margin discount means the retailer chooses to take a smaller margin, or no margin at all for a period, and passes the saving to the customer. The cost of the discount is borne by the retailer alone.”
According to the Presidency, a subsidy operates differently because the government pays part of the cost that consumers would ordinarily bear.
It added, “A subsidy is different. It is when government pays part of the price the consumer would otherwise pay. That money comes from public revenue — funds that would otherwise go to salaries, schools, hospitals and infrastructure.”
The Presidency stressed that the fuel subsidy regime ended in 2023 under President Bola Tinubu’s administration.
It declared, “That is the regime this administration ended in 2023, and it is not coming back.”
The clarification comes amid renewed political debate over fuel pricing and claims by opposition groups regarding the government’s economic policies.
Since the removal of fuel subsidy in May 2023, the Federal Government has consistently maintained that ending the policy was necessary to reduce pressure on public finances and redirect resources to critical sectors of the economy.
The latest statement is aimed at reinforcing the government’s position that any temporary reduction in pump prices resulting from marketers’ business decisions should not be mistaken for the return of fuel subsidy.
