Mele Kyari, the Group CEO of the Nigerian National Petroleum Company Limited (NNPCL), has attributed rampant cross-border fuel smuggling to the now-removed fuel subsidy.
He explained that smugglers previously earned as much as N17 million per trip from a 6,000-litre fuel truck, making it a highly profitable illegal trade.
Kyari revealed that the same truck, when sold legally within Nigeria, particularly in Borno State, would generate no more than N500,000. However, since the subsidy removal in June, the country has stopped losing revenue to smuggling, as fuel prices now reflect their true market value.
“For the last 47 years, petrol has been subsidized, creating arbitrage—a price gap between locations that smugglers exploit,” Kyari said. He explained that the recalibration of fuel prices following President Tinubu’s announcement has removed the incentive for smugglers.
“Previously, with a 6,000-litre truck, smugglers could earn up to N17 million per trip. It was easy for someone to make double that amount with just two trips, the equivalent of the truck’s purchase price,” Kyari added.
He further emphasized that under the current market-driven pricing system, taking the fuel legally to places like Maiduguri would only generate minimal profit, making smuggling far less lucrative.
“As long as there is no subsidy regime, the country will no longer lose money to smuggling,” he concluded.
