World Bank Indicts NNPC, Says Company Remitting Half of Subsidy Gains to FG

• World Bank’s latest report has indicted the Nigerian National Petroleum Company Limited for unremitted funds to the federation account
• The bank disclosed that the state oil company only remits about 50% of subsidy earnings to the federation account
• The World Bank stated that the NNPC uses the rest of the subsidy earnings to settle petrol-related debt

Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.

A new report by the World Bank says that the Nigerian National Petroleum Company Limited (NNPC) only remits half of the financial proceeds from petrol subsidy removal to the federation account due to debt arrears.

President Bola Tinubu announced the removal of the subsidy in 2023, tripling petrol prices. However, the move was projected to save Nigeria billions of dollars annually.

NNPC explains reason for the unremitted funds

The decision was part of the economic reforms of Tinubu’s government and was meant to free up funds for critical infrastructure and social intervention programmes.

However, in the World Bank’s latest report on Nigeria, the bank disclosed that the state oil firm has been transferring about 50% of the subsidy savings to the federation account, which is shared among the three tiers of government.

According to the report, NNPC began transferring the revenue gains in January 2025, despite the subsidy removal in October 2024. 

The global lender said that since then, NNPC has been remitting only 50% of the gains, with the rest used to repay past arrears.

FG hopes to earn more from the subsidy removal

The report noted that the Nigerian government’s revenue for 2025 is expected to be about 70% from oil and 30% from non-oil sources if full remittance of the fiscal savings from petrol subsidy removal is implemented.

According to a BusinessDay report, as of March 2025, NNPC had not made the full remittances, as it claims it has large petrol-related subsidies to settle.

The World Bank’s revelation comes as Dangote Refinery slashed petrol prices again as it battles depot owners and importers.

Dangote aims at importers with price cuts

The move has intensified competition with private depot owners, who accused the refinery of plotting to monopolise the downstream sector in Nigeria.

Experts say the new cuts are a direct aim at the depots as it seeks to tighten control on Nigeria’s petrol supply, where price war determines market dynamics.

According to PetroleumPriceng, as of Saturday, May 10, 2025, Dangote Refinery listed retail prices at N830 per litre, reflecting the new price cuts.

The refinery’s pricing strategy tightens the noose on depot owners and importers who lament the cost of the price slashes.

Analysts say the depot owners and importers are weighed down by FX volatility and high landing costs, which affect their competitiveness.

Filling stations adjust to new prices

According to reports, several filling stations have adjusted their pump prices to reflect the new cut.

Currently, Menj filling stations now sell Dangote petrol at N837 per litre, MRS at N836 from N880, and Swift at N835.

The new price cuts have reduced the gap by N10 to N15, mounting pressure on competitors.

NNPC launches new shipping company

Legit.ng earlier reported that the NNPC has partnered with Stena Bulk, a Swedish shipping agency, Stena Bulk, and Caverton to launch Unity Shipping Worldwide (USW).

The development comes amid the disbursement of the $700 million cabotage fund by the Nigerian government to support indigenous ship owners in acquiring new vessels.

Nigeria is reportedly the eighth-largest oil exporter globally and lacks a national fleet.

Proofreading by Nkem Ikeke, copy editor at Legit.ng.

Source: Legit.ng