The Impact of the Removal of Fuel Subsidy on the Cost of Living of the Nigerian Citizens (a Study of Bola Ahmed Tinubu Administration)

ABSTRACT This study critically examines the impact of the removal of fuel subsidy on the cost of living of the Nigerian citizens. The objective of this study is to examine the rationale for the removal of fuel subsidy and find out if the removal of fuel subsidy poses any threat on the cost of living of the Nigerian citizens. The study made use of both primary and secondary sources of data collection. The primary source of data was through a well structured questionnaire and the chi-square method was used in the testing of hypotheses. It was observed that there is no significant rationale for the removal of fuel subsidy and that government action on removal of fuel subsidy poses threat on the cost of living of the Nigerian citizens. The study revealed that removal of fuel subsidy has direct economic consequences, including inflationary pressures, increase in national debt, increased poverty and vulnerability, as well as protest and social unrest. This study recommends that government should ensure transparency and accountability in the management of funds saved from subsidy removal. There should be accelerating efforts to diversify its economy away from overreliance on oil. This can mitigate the economic shocks caused by fluctuations in oil price. Government must adopt a holistic approach that balances economic efficiency, social welfare, environmental sustainability and inclusive growth.