Energy Consumption and Socio-Economic Development: The Promise and Threat of Subsidy Removal in Nigeria

The goals of subsidies are to lessen inequality, help families escape energy poverty, and lessen the negative effects of volatile commodity prices on both producers and consumers. The study provides some insight into energy consumption and socio-economic development of subsidy removal in Nigeria using the discourse analysis methodology. The study revealed that fuel subsidy removal in Nigeria would free up funds for other sectors, encourage domestic refineries to produce more petroleum products, lessen Nigeria's reliance on imported fuel, create jobs, reduce the deficit in the budget and create a budget surplus, decrease government borrowing, reduce corruption related to fuel subsidy payments, intensify competition, revitalize domestic refineries, and ease pressure on the exchange rate. Again, the withdrawal of gasoline subsidies may have the unfavorable effects (threat) of short-term slower economic growth, more inflation, greater poverty, increased fuel smuggling, higher crime rates, higher petroleum product prices, and a loss of jobs in the unorganized sector and threatening the very existence of peace and security. The study submit that the government thoroughly assess the effects of eliminating fuel subsidies on people and businesses, and offer palliative care as well as various forms of financial assistance to lessen the negative effects on them. Moreover, we advise that before fuel subsidy reforms are implemented, the required safety nets for the impoverished be put in place.