Nigeria’s decision to remove petrol subsidies is sending economic ripples across its borders, disrupting informal fuel-trading networks in neighbouring countries and exposing the regional consequences of a policy that has become a major issue in the country’s emerging 2027 presidential debate.
Key Highlights
- A man who appears to be Cameroonian says in a viral video that fuel in Cameroon and Chad became far more expensive after Nigeria ended its petrol subsidy.
- Nigeria’s subsidy kept pump prices low, encouraging informal traders to move petrol into Cameroon, Benin, Togo and other neighbours.
- President Bola Tinubu removed the subsidy on May 29, 2023, narrowing the price gap that drove cross-border smuggling.
- Atiku Abubakar proposes a targeted subsidy, Peter Obi says he would retain the subsidy while tackling corruption, and Donald Duke wants petrol at about ₦300 per litre.
- Any return of subsidies could recreate the price differences that fuel informal cross-border trade.
An apparent Cameroonian national has raised concerns in a recent video online over the impact of the policy on fuel prices and availability in Cameroon and Chad, claiming that both countries previously benefited from petrol supplied from Nigeria before the administration of President Bola Tinubu ended the subsidy.
In the video statement, the man complained that fuel had become significantly more expensive following the policy change. He expressed hope that a change in Nigeria’s political leadership could reopen access to cheaper Nigerian petrol.
His remarks offer a glimpse into how a domestic economic decision in Africa’s largest economy can affect livelihoods beyond its borders. However, his claims do not establish the extent to which Cameroon and Chad depend on Nigerian fuel for their national consumption.
The concerns also bring into focus a wider question: who bears the economic cost when Nigeria changes its fuel policy, and what should a sustainable regional energy arrangement look like?
How Subsidy Removal Disrupted Cross-Border Fuel Trade
For years, Nigeria’s petrol subsidy kept domestic pump prices artificially low relative to prices in several neighbouring countries. The price difference created a lucrative incentive for informal traders to move Nigerian petrol across porous borders into Cameroon, Benin, Togo and other nearby markets.
While the arrangement helped sustain informal businesses and gave some consumers access to cheaper fuel, it also meant that government expenditure intended to support Nigerian consumers indirectly benefited buyers outside the country.
President Tinubu announced the removal of the petrol subsidy on May 29, 2023, triggering a sharp increase in domestic fuel prices and narrowing the price advantage that had encouraged cross-border smuggling.
The change disrupted informal supply chains, affecting roadside fuel vendors, commercial drivers and small businesses that depended on the trade.
A Reuters report published in June 2023 documented the difficulties experienced by informal fuel sellers and transport operators in neighbouring West African countries following Nigeria’s subsidy removal.
Research published by African Arguments in July 2023 also examined the consequences for communities in Cameroon’s Anglophone regions, where informal fuel trading had become an important source of economic activity.
The effects illustrate the interconnected nature of border economies. A policy introduced to address Nigeria’s fiscal challenges can alter prices, trade flows and employment opportunities in communities outside the country.
However, the disruption of informal trade should not be confused with the termination of all legitimate petroleum supplies from Nigeria to neighbouring countries.
The Regional Economic Dilemma
Nigeria’s subsidy removal raises a difficult question for regional economic relations: should Africa’s largest oil producer continue to maintain artificially low domestic fuel prices when the resulting price difference can encourage smuggling into neighbouring countries?
From Nigeria’s perspective, the former subsidy system placed considerable pressure on public finances, while the benefits were not always confined to Nigerians.
For communities in neighbouring countries, however, the price difference supported informal businesses, provided cheaper fuel and helped some transport operators manage their costs.
Once that advantage disappeared, traders had to contend with a new economic reality.
Higher fuel costs can feed into transport fares, food distribution and the prices of goods and services. Small businesses with limited financial reserves are particularly vulnerable to sudden increases in operating expenses.
The policy therefore exposes a tension between national fiscal reform and regional economic dependence.
Cameroon and Chad cannot reasonably expect Nigeria to maintain a costly subsidy principally to sustain informal cross-border fuel markets. At the same time, the disruption highlights the need for legitimate energy-trading arrangements that can support regional commerce without relying on price distortions or fuel smuggling.
Atiku’s Promise to Restore Targeted Subsidy
The regional implications are emerging as Nigerian politicians advance competing visions for the country’s fuel policy ahead of the 2027 presidential election.
Former Vice President Atiku Abubakar has advocated restoring a targeted petrol subsidy if elected, arguing that the removal of the intervention has intensified economic hardship and weakened household purchasing power.
His proposed approach is intended to provide relief to vulnerable Nigerians without necessarily returning to the former system, which critics accused of being costly and vulnerable to corruption.
The proposal raises questions about how beneficiaries would be identified, how the programme would be financed and what safeguards would prevent a return to the inefficiencies associated with the previous arrangement.
For neighbouring countries, a restoration of subsidies could also recreate the price differences that encouraged informal fuel trading, depending on the level of support and the prices prevailing across the region.
This makes the design of any future subsidy programme important not only for Nigeria’s public finances but also for the management of cross-border trade.
Obi and Duke Offer Different Routes
Peter Obi, the former Anambra State governor, has also reignited debate over the policy after indicating that he would retain the subsidy while tackling corruption surrounding its administration.
Obi had previously supported subsidy removal, arguing that government resources should be redirected towards productive sectors such as education, healthcare and infrastructure.
However, in an interview with the BBC on October 6, 2026, he said he would retain the subsidy while addressing corruption associated with its implementation.
His position reflects an argument that assistance to consumers may still be necessary, provided the system is transparent and the benefits reach those who need them.
The shift raises a central policy question: can Nigeria protect vulnerable households from high fuel costs without recreating an expensive and poorly administered subsidy regime?
Obi has also emphasised the need to strengthen domestic production, improve refining capacity and expand exports as part of a broader strategy to improve Nigeria’s economic position.
His approach differs from simply restoring the previous arrangement because it places greater emphasis on reforming the system through which support is provided.
Former Cross River State governor Donald Duke has proposed a different route to reducing petrol prices.
Rather than reviving the traditional subsidy arrangement, Duke has advocated pricing domestically consumed petroleum products according to production costs instead of international market benchmarks.
In an interview with Channels Television reported by Premium Times on October 7, 2026, Duke said he would seek to reduce petrol prices to about ₦300 per litre if elected president.
His proposal involves allocating part of Nigeria’s crude oil production to domestic consumption while exporting the remainder.
The argument is that Nigeria should be able to use its status as an oil-producing country to provide more affordable energy to its citizens.
However, domestic crude allocation does not automatically guarantee cheaper petrol. The cost of extraction, refining, transportation, distribution and financing must still be accounted for. Pricing fuel below its economic cost could also create implicit subsidies or reduce potential export revenue.
The feasibility of Duke’s proposal would therefore depend on transparent cost accounting, efficient refining operations and a clear mechanism for determining domestic prices.
The three political positions represent different approaches to the same problem: Atiku favours targeted government support, Obi has advocated retaining subsidy while tackling corruption, and Duke proposes reducing prices through a domestic production-cost model.
Read also:
- IMF Warns Nigeria Against Blanket Petrol Subsidy, Backs Targeted Relief
- Pat Utomi Slams Tinubu Over ₦1,300–₦1,900 Petrol Prices, Low Wages in Nigeria
- Nigerians Turn to Rechargeable Motorcycles as Rising Fuel Prices Increase Transport Costs
What a Sustainable Fuel Policy Requires
The debate should extend beyond whether the subsidy should be restored or permanently abandoned.
Nigeria needs an energy policy that balances affordable fuel, fiscal responsibility, domestic refining, social protection and sustainable trade with neighbouring countries.
The removal of the subsidy was intended to ease the government’s financial burden and correct distortions in the petroleum market. Yet higher fuel prices have increased pressure on transport costs, food prices, businesses and household budgets.
In July 2026, Reuters reported that Nigeria’s finance minister said much of the financial benefit from subsidy removal and foreign-exchange reforms had been absorbed by debt-servicing costs and higher government expenditure. The report renewed questions about how the gains from the reforms were being used and whether citizens had received sufficient relief.
A sustainable approach would require transparent reporting on the use of fiscal savings, targeted assistance for vulnerable households, investment in public transportation and improved domestic refining efficiency.
It would also require Nigeria and its neighbours to strengthen legitimate petroleum trade, improve border management and reduce dependence on informal markets created by differences in fuel prices.
For Cameroon and Chad, the experience demonstrates the risks of relying on cheaper supplies generated by another country’s domestic pricing policy. For Nigeria, it shows that reforms designed to address national economic problems can have consequences for regional livelihoods and commerce.
The 2027 election offers an opportunity for presidential contenders to explain how their proposals would be funded, implemented and sustained—and whether their policies would support a more stable regional energy market.
Ultimately, Nigeria’s challenge is not simply to determine the price of petrol. It is to build an economic system that protects vulnerable citizens, supports productive businesses and manages the country’s natural resources in a way that delivers lasting benefits.
Until that vision becomes clearer, the effects of Nigeria’s fuel policy will remain a subject of concern for households, traders and businesses across its borders.
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