Pressure Mounts on Nigerian Government Over Fuel Prices

Posted January 11th, 2012 at 8:30 am (UTC-5)
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Thousands of Nigerians are demonstrating against soaring fuel costs for a third straight day, as the country’s main oil unions consider joining the protest.

Leaders with the two main unions — one for senior staff, one for workers — said Wednesday they are discussing a possible shutdown of oil production and exports.

The move could have a devastating impact on Nigeria’s economy and affect global oil prices. The country is Africa’s top oil producer and exports more than two million barrels of crude oil a day.

Nigeria’s two main labor unions organized the nationwide strike this week in a bid to pressure President Goodluck Jonathan and his government to restore a popular consumer fuel subsidy.

The government eliminated the subsidy on January 1, causing fuel prices to double overnight.

Tens of thousands of demonstrators took to the streets in major cities on Wednesday, including the main commercial city of Lagos and the capital, Abuja.

Union leaders urged Mr. Jonathan to listen “to the voice of the people”, while government officials warned government workers they would not get paid unless they return to their jobs.

Mr. Jonathan has refused to reinstate the subsidy, saying the government can no longer afford it. He says getting rid of the subsidy will save at least $8 billion this year, which he promises to use on infrastructure and social programs.

The Nigeria Labor Congress and Trade Union Congress say the strikes will continue until the government reinstates the fuel subsidy.

Most Nigerians live on less than $2 a day and the fuel subsidy was one of the few benefits they received from the country’s oil wealth.

Some economists have called the subsidy corrupt and wasteful, saying it encouraged smuggling into neighboring countries where fuel was more expensive.