Expert: Rising Petrol Price Could Necessitate Salary Increase

Mohammed Nezifi, a development economist, has warned that the recent hike in petrol prices could pressure the government to increase worker wages. In an interview with NAN on Friday in Abuja, Nezifi stated that the government might face demands for pay rises or subsidies, potentially leading to higher fiscal deficits and public debt.

The Nigeria National Petroleum Company Limited (NNPCL) Retail Management recently authorized a fuel price increase on September 3, raising the pump price from N568–N617 per litre to N897 per litre.

Nezifi highlighted that the fuel price hike disproportionately affects lower-income households, who spend a larger share of their income on essentials like food and transportation. This could widen the gap between the rich and the poor and increase poverty rates.

He noted that while government interventions, such as social welfare programs or subsidies, might be necessary to mitigate these effects, they could also strain national resources. Nezifi cautioned that economic hardship resulting from higher petrol prices could lead to societal disturbances, such as strikes or protests, which could destabilize governance and the economy.

David Ambi, another economic expert, suggested that the government should consider fostering a more competitive market environment to address these challenges. He proposed reintroducing targeted subsidies or social safety nets and aligning policies with economic principles that support consumer protection and market efficiency. According to Ambi, these measures would improve citizens' living standards and help stabilize the economy.