The World Bank has accused the Nigerian National Petroleum Company Limited (NNPCL) of withholding half of the fuel subsidy savings, stating that the company failed to transfer the full amount into the Federation Account.
Revenue Diverted To Settle Debts
In its latest Nigeria Development Update, titled “Building Momentum for Inclusive Growth”, the Bank explained that NNPCL earned ₦1.1 trillion in 2024 from crude oil sales and related income.
However, it only sent ₦600 billion to the Federation Account and, instead, used the remaining ₦500 billion to settle debt arrears.
Fuel Subsidy Reform Delayed
After President Tinubu removed fuel subsidies in 2023—tripling petrol prices—he promised to redirect the savings towards infrastructure and social welfare.
Yet, due to strong public opposition, the government postponed full deregulation until October 2024, aligning it with the launch of the Dangote Refinery.
Late Remittance Despite Reform
Following the official removal, NNPCL delayed the transfer of savings until January 2025.
Since then, it has only remitted 50% of the proceeds.
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The World Bank cautioned that Nigeria’s 2025 budget, which depends on oil for 70% of its revenue, could suffer if NNPC fails to remit the full amount.
Revenue Agency Underperforms
Unlike other major revenue-generating agencies, NNPCL underperformed in 2024.
It reduced its contribution from ₦1.1 trillion in 2023 to ₦600 billion, largely due to the quiet continuation of subsidies until late 2024.
Disputed Arrears And Transparency Call
As of February 2025, NNPCL claimed the government owed ₦7.8 trillion, while the Federation acknowledged ₦6.1 trillion—leaving a disputed balance of ₦1.7 trillion.
Therefore, the World Bank urged Nigeria to enforce stronger transparency in managing oil revenue.
