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Nigeria protests suspended after fuel price cut

By on January 16, 2012

Nigerian President Goodluck Jonathan said on Monday petrol prices would be reduced to 97 naira a litre and labour unions agreed to suspend mass protests to allow further negotiations with the government.

Tens of thousands took to the streets for strikes over five successive days last week in protest against the sudden removal of a fuel subsidy on January 1 that more than doubled the pump price of petrol to 150 naira per litre from 65 naira.

Jonathan met unions late on Sunday to try and find a compromise to end the strikes, which are due to resume on Monday. He said the talks had “yielded no tangible result” and pledged to continue along the path of removing subsidies.

“Government will continue to pursue full deregulation of the downstream petroleum sector. However, given the hardships being suffered by Nigerians, and after due consideration and consultations … government has approved the reduction of the pump price of petrol,” he said in a pre-recorded speech.

Nigeria’s main labout unions said they would suspend street protests but strikes that have paralysed Africa’s second-largest economy would go ahead pending further talks on Monday.

“President Jonathan is expected to address the nation this morning so labour has asked our members to sit at home today. No protest and no rallies,” said Chika Onuegbu, an official at Nigeria’s main oil union PENGASSAN and umbrella labour union Trade Union Congress.

“Labour has also fixed another meeting by 1000 (0900 GMT)this morning at Labour House Abuja with the hope that President Jonathan will make the broadcast and labour can then review the situation and hopefully suspend the strike action,” he said.

PENGASSAN previously said it would cut oil output from Africa’s largest producer if government talks broke down.


Global oil prices were boosted by Nigeria supply fears late last week and a serious production outage would push them sharply higher, according to traders and analysts.

Several people were killed in clashes with police last week and 600 were treated for wounds, according to the International Red Cross.

The government and unions had a first round of talks on January 12 and a second round two days later with both sides saying progress was being made but that more deliberations were needed.

Unions said they wanted the government to immediately bring the petrol price back down to 65 naira, at which point they would cancel strikes and protests and talks could continue.

The government slashing the pump price to 65 naira without any guarantee of subsidies being removed in the future would have been a major climbdown.

Workers had suspended strike action for the weekend because of talks and to allow protesters to rest.

Economists have said the subsidy needed to be removed because it was wasteful and open to corruption. Protesters have countered that argument by asking the government to work harder to tackle corruption and waste before removing public benefits.

Jonathan gave approval on Sunday for an investigation.

Oil Minister Diezani Alison-Madueke said she had written a letter to the Economic and Financial Crimes Commission inviting the regulator to investigate the subsidy procedure.

The state oil company NNPC and fuel regulators have come under fire for a lack of transparency and mismanagement from independent reports, including one by KPMG. Alison-Madueke pledged to review these reports.

Nigeria produces more than 2 million barrels of crude oil a day but due to decades of corruption and mismanagement it has to import almost all its refined fuel needs.

Africa’s most populous nation holds the world’s seventh largest gas reserves but infrastructure only provides enough power to support a medium-sized European city, meaning most of the country’s 160 million people live without electricity.

Alison-Madueke said she would meet legislators in the next week to push forward progress on passing a wide-ranging Petroleum Industry Bill (PIB). The PIB has been locked in parliament for years, costing Nigeria billions of dollars in lost investment.


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