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Oil Windfall vs. Fuel Price Transmission: Nigeria's Post-Subsidy Resilience Test in a Volatile Global Market

Author

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  • Olaniyi Evans

Abstract

Nigeria's removal of fuel subsidies on May 29, 2023, has delivered measurable fiscal gains, supporting the 2026 Budget of Consolidation and its increased capital expenditure allocation. However, the removal of the price buffer has exposed domestic consumers to global crude price movements in real time. This paper examines the structural mechanics of post-subsidy oil price transmission, the Dangote Refinery's partial but genuine role in reducing import dependence, and the policy tensions between reform credibility and household relief. The analysis identifies structural weaknesses in power, logistics, and FX intermediation that continue to limit the inclusive growth dividend of Nigeria's macroeconomic stabilisation programme, with implications for capital allocation.

Suggested Citation

  • Olaniyi Evans, 2026. "Oil Windfall vs. Fuel Price Transmission: Nigeria's Post-Subsidy Resilience Test in a Volatile Global Market," Hequation Review, Hequation, vol. 1(1), pages 1-5.
    • Handle: RePEc:heq:heqrev:v1y2026i1a1
    DOI: 10.6084/m9.figshare.32220972
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    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • H62 - Public Economics - - National Budget, Deficit, and Debt - - - Deficit; Surplus
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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