Nigeria has raised oil prices by two thirds in a bid to ease fuel shortages and cut huge subsidies.
The decision by the petroleum minister will see a litre of petrol now sell at 145 naira, which is equivalent to 0.73 US dollars up from 86.5 naira effective Wednesday.
The decision was reached after a meeting of oil stakeholders, which was presided by Nigeria’s Vice-President, Yemi Osinbajo.
Along with this decision, the federal government has in the 2016 budget made an unprecedented social protection provision to cushion the current challenges.
The fuel shortage in Nigeria has raised fuel prices in the black market to 250 naira a litre.
Nigeria’s Petroleum Minister, Ibe Kachikwu, says the government expects the new measures will create competition in supply and later lead to a decrease in pump prices in the days ahead.
“But as we have constantly said, the inherited difficulties of the past and the challenges of the current times imply that we must take difficult decisions on these sorts of critical national issues. Along with this decision, the federal government has in the 2016 budget made an unprecedented social protection provision to cushion the current challenges, “ Kachikwu said.
Africa’s top oil exporter has been facing a difficult economic situation due to a fall in oil prices on the global market. The slump has affected Nigeria’s income and reduced the pace of infrastructural projects.Nigeria’s labour union has however described the price hikes as a “unilateral decision which represents the height of insensitivity and impunity.”
The Union which further described the increase as “criminal” will hold an emergency meeting on Friday May 13, to decide on the next course of action.