Presidency Fires Back At Atiku, Recalls Failed Crude Subsidy Experiment Under Obasanjo

The Presidency has criticised former Vice-President Atiku Abubakar over his proposal to subsidise crude oil supplied to local refineries, arguing that Nigeria previously experimented with a similar policy during the administration of former President Olusegun Obasanjo.

According to Ireporter Online, Senior Special Assistant to President Bola Tinubu on Digital and New Media, Otega Ogra, made the remarks while responding to Atiku’s proposal for a production subsidy aimed at reducing the cost of petrol refined locally.

Atiku had argued that the proposed subsidy should focus on supporting domestic refining rather than subsidising imported petroleum products, with the goal of lowering production costs and making petrol more affordable for Nigerians.

However, Ogra dismissed the proposal, claiming that a similar arrangement was implemented when Atiku served as Vice-President under Obasanjo.

“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,” Ogra said in a post on X.

The presidential aide cited refinery utilisation figures from the period to support his argument, pointing to what he described as poor performance at some of the country’s major refineries.

According to Ogra, utilisation at the Warri Refining and Petrochemicals Company fell to 14.27 per cent in 2003 and 9.1 per cent in 2004. He also said the Kaduna refinery recorded utilisation rates of 15.96 per cent and 26 per cent during the same period.

Ogra further claimed that utilisation at the Port Harcourt refinery declined from 60.73 per cent in 2001 to 31.04 per cent in 2004.

He argued that despite the policy, petrol prices continued to rise significantly during the period.

“Meanwhile, the price of petrol more than tripled by 2004 and nearly quadrupled by the time you left office despite your production subsidy to local refiners,” he stated.

Ogra also claimed that the subsidy arrangement was later discontinued by the Obasanjo administration.

According to him, the government cancelled the crude discount arrangement on October 9, 2003, through Presidential Directive PRES/158 and subsequently directed the Nigerian National Petroleum Corporation to pay the international price for crude supplied to 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 added.

The presidential aide subsequently challenged Atiku to provide evidence that the earlier policy achieved its intended objectives before presenting a similar proposal to Nigerians.

“So, before selling Nigerians this failed production subsidy policy again, answer one simple question,” Ogra wrote.

He noted that many younger Nigerians may not be familiar with the events surrounding the earlier policy and urged Atiku to explain what evidence exists to show that the approach worked.

“It’s still the same theory you practiced then, and we haven’t changed country yet,” Ogra added.

The exchange has opened another political debate over the best approach to reducing petrol prices, with Atiku advocating support for domestic refineries while the Presidency questions the effectiveness of a similar policy implemented during the Obasanjo administration.