Understanding Oil Subsidy in Nigeria

Abstract

For several years, Nigeria enjoyed subsidy on gasoline. However, this came to an end on January 1st, 2012, after an announcement from President Goodluck Jonathan, that subsequently, the subsidy was to be removed. While some sort of resolution/middle ground has been reached in response to the reaction that this news generated, the concept and theory behind the oil subsidy removal is worth understanding. This research paper explains the history of the oil subsidy in Nigeria, the rationale behind its removal and subsequently, gives a few recommendations for future reference.