Nigeria fuel crisis: Labour Congress to go ahead with strike despite court ruling

Fuel crisis Nigeria — People queuing with jerry cans to buy fuel at a Mobil filling station in Lagos ahead of the petrol-price increases Utomi Ekpeiu/AFP/Getty

The Nigeria Labour Congress (NLC) has announced it is to go ahead with a planned strike over increased fuel prices despite a court ruling against industrial action. The NLC and the Trade Union Congress (TUC) announced a strike would commence on Wednesday (18 May 2016) after the government scrapped petrol subsidies by increasing prices by two-thirds in a bid to curb an ongoing fuel shortage, exacerbated by a foreign exchange crisis.

A litre of petrol in the country now costs 145 naira (50p), up from about 86.5 naira (30p). However, the move has angered many, with trade and labour unions labelling the decision "criminal" and calling for the strike.

The National Industrial Court, however, ruled against the strike, claiming it could cause civil disorder. Following talks with the government, the TUC called off the strike.

It is unclear how many NLC members will take part in the strike. The BBC has reported that some businesses were open in the federal capital Abuja on Wednesday, and some people confirmed they would go to work.

The Nigerian government justified its decision to increase petrol prices as a way to end fuel scarcity and call on citizens to respect the law and not take part in the strike.

Peter Walker, a UK-based senior consultant, told IBTimes UK that removing oil subsidy in Nigeria was a crucial first step towards tackling corruption and stabilising fuel prices.

Nigeria's oil subsidy explained

Nigeria is Africa's biggest oil producer, but its lack of refineries mean that the country has to export about 90% of its crude oil and import back petroleum products at international prices. The government then sells fuel to Nigerians at subsidised rates and reimburses the difference to importers.

Nigeria announced in May 2016 that petrol prices would rise to 145 naira, up from about 86.5 naira. The prolonged fuel scarcity in the country meant that Nigerians were already paying prices considerably higher – up to 250 naira – than the the price established after the subsidy was scrapped.

President Muhammadu Buhari, who took office in May 2015, has often been urged to end oil subsidy and privatise the country's oil refineries, so that the state would not spend money on yearly maintenance programmes. In July 2015, three out of the four refineries in Nigeria resumed production after undergoing a restructuring programme.

In 2012, the previous administration led by Goodluck Jonathan, attempted to end subsidies by doubling the price of a litre of petrol overnight, angering citizens who argued that low prices were the only benefits they enjoyed from the oil-rich nation. The government subsequently made U-turn on its decision following violent protests.

Nigeria up close: Check out our Flipboard magazine

Nigeria Oil