The controversy over petrol subsidy removal has taken a fresh political turn, with former Vice President Atiku Abubakar proposing a new production-based subsidy regime, while the Presidency and FCT Minister Nyesom Wike have rejected the plan and accused him of political inconsistency.

The Allied Peoples Movement (APM) has also joined the dispute, demanding a detailed account of the trillions of naira the Federal Government says it saved following President Bola Tinubu’s decision to end petrol subsidy in May 2023.

The widening dispute has pushed fuel subsidy, domestic refining and the management of subsidy savings to the centre of the political debate ahead of the 2027 presidential election.

Atiku, the African Democratic Congress (ADC) presidential candidate for 2027, unveiled his proposed subsidy framework under the Atiku Economic Recovery Plan (AERP 2027).

He said his proposal would not restore the former import-based subsidy system but would provide targeted support to qualifying Nigerian refineries through preferential access to domestic crude.

According to Atiku, public and private refineries would be eligible for subsidised crude only if they meet strict conditions on production, efficiency, transparency and domestic supply.

The programme, he said, would operate under a fixed annual fiscal ceiling approved through the national budget.

“My proposal is not to resurrect the old subsidy regime. We will move subsidy from importation to production, from middlemen to Nigerian refineries, and from unverifiable claims to verifiable barrels,” Atiku said.

“The principle is simple: the subsidy will follow the barrel.”

He said the cost, beneficiaries and fiscal limit of the programme would be known in advance, while the benefit to consumers would be measurable.

Atiku also proposed a tracking system under which crude allocations, refinery intake, production yields, inventories and domestic deliveries would be independently reconciled.

“No phantom cargoes. No fictitious imports. No unverifiable under-recoveries. No retrospective claims,” he said.

Under the proposed system, any refinery receiving preferentially priced Nigerian crude would be required to refine it locally and supply an agreed quantity of petroleum products to the domestic market.

Atiku said the scheme would apply equally to qualifying public and private refineries and would not be designed to favour any particular operator.

He also proposed that the intervention should gradually disappear as domestic refining capacity increases, competition improves and production costs decline.

“Our objective is not permanent subsidy. It is to use temporary and disciplined support to build a refining industry strong enough eventually not to need subsidy,” he said.

The former vice president also promised to reopen questions surrounding the management of subsidy funds under previous administrations, saying anyone found to have fraudulently obtained or diverted public funds would face prosecution and asset recovery.

The proposal, however, was swiftly rejected by the Presidency.

Bayo Onanuga, Special Adviser to President Bola Tinubu on Information and Strategy, accused Atiku of attempting to reverse the administration’s petroleum-sector reforms for political gain.

In a statement titled, “Restoring Petrol Subsidies: Atiku’s Volte-Face and Desperation for Power,” Onanuga challenged the former vice president to explain how his proposed subsidy would be financed.

The Presidency argued that the subsidy regime abolished in May 2023 placed a huge fiscal burden on government by requiring it to absorb the difference between the actual cost of petrol and the regulated pump price.

Onanuga said Atiku must disclose the annual cost of his proposal, its source of funding and the legal framework for implementing it.

He also rejected Atiku’s reference to a N30 trillion subsidy-removal windfall.

“Contrary to Atiku’s claim in his interview, no N30 trillion subsidy windfall or savings exists anywhere except in his imagination,” Onanuga said.

The Presidency maintained that subsidy removal had reduced government’s fiscal burden and increased resources available to the Federal Government, states and local governments through the Federation Account.

The Federal Ministry of Finance puts estimated subsidy savings across the Federation at N15.8 trillion, comprising N5.43 trillion for the Federal Government, N6.52 trillion for states and N3.88 trillion for local governments.

The ministry stressed that the N15.8 trillion was not a single pot of money sitting with the Federal Government but represented savings distributed through the Federation Account.

It further said the Federal Government’s N5.43 trillion share, together with N3.12 trillion in incremental revenues and N11.85 trillion in incremental borrowing, amounted to about N20.4 trillion in additional resources during the period.

The government said additional expenditure during the period stood at about N30.64 trillion.

But the figures have triggered another layer of controversy.

The APM has demanded a comprehensive breakdown of the reported N15.8 trillion subsidy savings, asking the government to disclose exactly how much was generated, received and distributed.

In a statement by its National Publicity Secretary, Abubakar Yusuf, the party demanded details of allocations to each state and local government, the dates of disbursement and the purposes for which the funds were used.

The party also called for clarification of the government’s figures in light of an earlier claim attributed to former Finance Minister and Coordinating Minister of the Economy, Wale Edun, regarding savings from subsidy removal.

The APM said Nigerians had a right to know where the money went and what impact the savings had made on their economic conditions.

Atiku has meanwhile raised another question over petroleum-related expenditure recorded after the government announced the end of subsidy.

Citing NNPC Limited’s audited financial statements, he said the company recorded about N4.84 trillion in Energy Security Expenses in 2023 and N7.13 trillion in 2024.

Atiku argued that the government should explain the nature of the expenditure and whether it covered under-recoveries, pricing differentials or other petroleum-supply costs.

“We are not interested in playing games with accounting terminology,” he said.

“If government continued absorbing differences between the economic cost of petroleum products and what was recovered from the market, then Nigerians are entitled to ask how that differs economically from the subsidy they were told had disappeared.”

He argued that Nigerians should not be made to bear the cost of subsidy removal through higher pump prices while also carrying unexplained subsidy-like expenses in government accounts.

Atiku also called for a month-by-month reconciliation of approximately N30 trillion in Federation revenues, deductions, savings, transfers and related classifications.

He clarified that he was not alleging that the entire amount represented fuel subsidy or had been stolen.

“We are not saying N30 trillion is fuel subsidy or that N30 trillion has been proven stolen,” he said.

“We are saying that approximately N30 trillion reflected across Federation revenues, deductions, savings, transfers and related classifications requires a complete, month-by-month public reconciliation.”

He challenged the Federal Government to publish the details.

“Publish every deduction. Identify every beneficiary. Show every transfer. Show every balance. Show the legal authority. If the money is properly accounted for, open the books and end the argument,” Atiku said.

Wike has also entered the fray, accusing Atiku of abandoning his previous position on subsidy removal in pursuit of political advantage.

Speaking in Abuja during an inspection of FCT infrastructure projects, Wike described Atiku as a “voodoo economist” and questioned the former vice president’s consistency.

“Atiku will say anything just to be president,” Wike said.

The minister recalled that Atiku had promised during the 2022 presidential campaign to remove fuel subsidy within his first 100 days if elected.

“Now, in 2026, he is not going to remove the fuel subsidy. Is he going back to the fraud, which he had alleged that fuel subsidy was?” Wike asked.

He argued that presidential candidates should maintain consistent policy positions instead of changing their positions according to political circumstances.

Wike also questioned the practicality of Atiku’s proposal in the current petroleum landscape, pointing to the Petroleum Industry Act and the transformation of the Nigerian National Petroleum Corporation into NNPC Limited.

He said NNPC was no longer the country’s sole importer or producer of petrol and questioned how the proposed arrangement would affect private refiners.

“Will Atiku, as President—which he never will be—pay subsidy on fuel produced by Dangote Refinery?” Wike asked.

The minister argued that the former subsidy system encouraged smuggling and arbitrage while placing enormous pressure on government revenue.

He said Atiku should instead explain how the savings from subsidy removal should be deployed to improve the lives of Nigerians.

The Presidency has similarly warned that restoring any form of broad petrol subsidy could undermine investment in domestic refining.

Onanuga argued that the emergence of the Dangote Refinery and the changing structure of the downstream petroleum sector were among the developments made possible by the removal of subsidy.

The Presidency also warned that selling petrol below its economic cost would simply shift the burden back to government.

“If petrol is sold below its economic cost, which is about N1,200 to N1,300, someone must absorb the difference,” Onanuga said.

Atiku, however, maintains that his proposal is fundamentally different from the old subsidy regime because it would be capped, budgeted, independently audited and tied directly to domestic production.

The disagreement has therefore evolved beyond the question of whether petrol subsidy should return.

It now centres on what form government support for domestic fuel production should take, how much such intervention should cost, whether it can be transparently managed and how the trillions of naira the government says it has saved since subsidy removal have been accounted for.

With the 2027 presidential election approaching, the subsidy debate is increasingly becoming a battle over economic policy, public accountability and competing visions for Nigeria’s petroleum sector.