Nigeria mobilised N15.8 trillion in resources from petrol subsidy savings between June 2023 and December 2025, Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, has disclosed. Oyedele made the disclosure on Wednesday during a media conference on the scorecard of the Federal Government’s economic reforms between 2023 and 2026, highlighting how the removal of petrol subsidies reshaped the country’s fiscal position.
According to the minister, the N15.8 trillion generated through subsidy savings was distributed across the federation, with the Federal Government receiving N5.4 trillion, while states and local governments shared N10.4 trillion. Oyedele explained that the increase in revenue was also influenced by the higher naira value of dollar-denominated transactions following the government’s foreign exchange reforms.
Beyond subsidy savings, the Federal Government generated an additional N3.1 trillion in independent revenue, largely through remittances from government-owned entities. Oyedele said the combination of subsidy savings, independent revenue and additional borrowing provided the Federal Government with N20.4 trillion in incremental resources during the period. He added that without the fiscal space created by the reforms, the government’s additional borrowing of N11.9 trillion could have been significantly higher and economically destabilising.
The minister, however, noted that the additional resources came alongside major expenditure pressures. The Federal Government spent N30.64 trillion in incremental expenditure, including N9.39 trillion on wage adjustments, minimum wage increases and allowances for public servants. Another N9.37 trillion went towards external debt servicing, while N6.5 trillion was allocated to strategic infrastructure. Oyedele pointed out that higher debt-servicing costs were largely driven by the naira’s depreciation, which meant the government needed substantially more naira to meet dollar-denominated obligations.
Oyedele maintained that the reforms were not introduced simply to increase government revenue but to tackle what he described as entrenched corruption and inefficiencies in Nigeria’s fuel subsidy and foreign exchange systems. He said the figures demonstrate the financial impact of the reforms while also highlighting the difficult trade-offs facing the government as it balances higher wages, debt obligations, infrastructure spending and fiscal stability. The disclosure is likely to keep the debate over the economic impact of petrol subsidy removal alive, particularly as Nigerians continue to feel the effects of the reforms on household spending and the wider cost of living.
source: The cable
