Lagos State Governor Babajide Sanwo-Olu has defended the Federal Government’s decision to remove the petrol subsidy, acknowledging the financial pressure it has placed on households while arguing that key economic indicators suggest the reform is beginning to deliver results.
Sanwo-Olu spoke on Thursday at the Freedom Online 7th Yearly Lecture in Ikeja, where he said the subsidy had become “a hole in the national purse through which the money for roads, schools and hospitals was draining away”. He also argued that much of the money spent on the subsidy did not ultimately benefit the motorists it was intended to support.
According to the governor, all major candidates in the 2023 presidential election had pledged to remove the subsidy, but “only one of them was in a position to do it, and he did it on his first day in office”.
Sanwo-Olu acknowledged that the policy has imposed significant hardship on Nigerians.
“I will not stand here and tell you that it has been painless. It has not,” he said. “Lagosians have felt it at the pump, at the market, and in the price of a bag of rice, and any governor who tells you otherwise has not been listening to his own people. But the measure of a reform is not whether it hurts. It is whether it heals.”
His comments come as the 2027 presidential campaign gathers momentum, with the subsidy policy emerging as a major point of debate between the ruling administration and the opposition.
Atiku Abubakar, the African Democratic Congress (ADC) presidential candidate, has promised to restore the subsidy if elected. In a post on X on August 26, Atiku stated: “On the question of subsidy, my position has not changed and will not change: I will restore it!”
He argued that the policy had worsened poverty, adding: “When fuel rises, transport rises. When transport rises, food rises. When food rises, families suffer.”
The Presidency has estimated that restoring the subsidy could cost the country ₦19.1 trillion, based on crude oil at $80 per barrel, amounting to roughly ₦52.3 billion daily.
President Bola Tinubu’s Special Adviser on Information and Strategy, Onanuga, has challenged Atiku to explain who would benefit from the subsidy, how the policy would be financed and when it would eventually end. He also recalled that Atiku had previously described the subsidy regime as “just a fraud” and pledged to complete its removal.
Sanwo-Olu based much of his defence on economic figures published by the National Bureau of Statistics (NBS) and the Central Bank of Nigeria (CBN), urging journalists and Nigerians to examine the data themselves.
“These are not my numbers,” he said. “Every journalist in this hall can check them. I invite you to.”
The NBS recently reported that Nigeria’s economy expanded by 4.43 per cent in the second quarter of 2026, compared with 3.89 per cent in the first quarter and 4.23 per cent in Q2 2025.
Agriculture grew by 4.39 per cent, up from 2.82 per cent a year earlier, while the services sector expanded by 4.6 per cent.
Sanwo-Olu also noted that the economy is more than 18 per cent larger in nominal terms than it was 12 months earlier. However, the figure is not adjusted for inflation, which stood at 15.91 per cent in June.
Nigeria’s external reserves also crossed the $53 billion mark in late August, reaching $53.11 billion, while the country recorded a foreign trade surplus of ₦7.55 trillion in the first quarter of 2026.
Inflation, which had risen to almost 35 per cent by the end of 2024, has since fallen considerably. The CBN also reported that Nigerians abroad sent $947 million through formal channels in July, representing the highest monthly inflow recorded so far.
On the capital market, Sanwo-Olu said the Nigerian Exchange has been among the world’s strongest performers this year, with the value of listed companies increasing significantly since 2023. Market capitalisation crossed ₦150 trillion on April 29, closing at ₦152.728 trillion.
The governor also reiterated the administration’s ambition of building a $1 trillion economy by 2030.
“Set the target, do the work, and let the scoffers keep the score.”
The Lagos governor further argued that the removal of the subsidy has significantly increased the amount of money shared among the three tiers of government.
He said monthly allocations to state and local governments have more than doubled in naira terms since the subsidy was removed, meaning governors can no longer attribute poor development outcomes solely to inadequate federal allocations.
The Federation Account Allocation Committee distributed ₦2.551 trillion in June 2026, with states receiving ₦838.21 billion and local government councils getting ₦591.39 billion.
By comparison, the three tiers of government shared ₦655.93 billion in May 2023, the last full month before the subsidy was removed.
“The President has done his part; the money is arriving. What is done with it is on us,” Sanwo-Olu said. “The excuses have been removed, and the electorate knows it.”
He added that voters may not necessarily be economists, but they understand how to assess what governments have done with public funds.
“may not be economists, but they are excellent accountants. They know whether their State built the road it promised. They know whether the primary health centre has a nurse in it. They will bring that ledger with them to the polling unit.”
Sanwo-Olu acknowledged that governments do not control every factor affecting the economy, pointing to global oil prices, conflicts in Europe and the Middle East, as well as interest-rate decisions by major central banks.
He said the responsibility of government is to respond effectively to such external pressures and protect households, businesses and industries from their impact.
However, the governor did not provide specific figures on the impact of subsidy removal on real household incomes, poverty or unemployment, nor did he state how much the Federal Government has saved since the policy was introduced in 2023.
