Why CNG Can Reduce Nigeria’s Dependence on Petrol Subsidies

I disagree with the argument that CNG pricing proves Nigeria is simply replacing petrol subsidy with another permanent intervention. Petrol subsidy keeps petrol cheap through continuous support, while the CNG strategy is meant to reduce reliance on petrol by building an alternative fuel market. The main challenge is the chicken-and-egg problem. Motorists will not convert their vehicles without nearby CNG stations, while investors may hesitate to build stations without enough CNG vehicles. Government support for early conversions and infrastructure can help create the demand needed for private investment. According to figures cited by the presidential CNG initiative, private-sector commitments have risen to about $2.5 billion. Operational CNG stations have also increased from fewer than 10 before 2023 to around 90, with more stations under development. The long-term goal should be competition, not permanent price control. More CNG vehicles, stations and transport operators can give Nigerians a practical alternative to petrol and help reduce the pressure created by subsidy removal.

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