Nigeria’s CNG Gamble Meets Global Fuel Crisis: Lessons From Other Countries

By NINI NDUONOFIT-AKOH

NIGERIA’S struggle with high transport fares is unfolding against a wider global energy crisis.

As international oil prices rise, governments in Africa, Asia and Europe have introduced different measures to protect consumers from the impact.

While some have temporarily cut taxes, others have subsidised fuel, supported public transport or invested in alternative energy.

Nigeria has chosen a different path. Rather than restore the petrol subsidy, the Federal Government is promoting CNG and electric vehicles as alternatives to petrol and diesel.

Nigeria Seeks a Transport Breakthrough

President Bola Tinubu said state governments had agreed to measures designed to reduce transportation costs from 1st October.

The National Affordable CNG Transit Programme forms a major part of that strategy.

The State House said more than 120,000 vehicles had been converted to CNG, with more than 400 certified conversion centres and over 90 refuelling stations nationwide.

Some states have already demonstrated the potential impact. Borno, for example, has used CNG-powered and electric public transport on selected routes at significantly lower fares than conventional commercial services.

Niger has also recorded lower fares on the Suleja-Abuja route, while Abia has deployed electric buses with subsidised fares.

Yet nationwide implementation remains a challenge because infrastructure is still uneven.

Kenya Prioritises Immediate Relief

Kenya has responded to the crisis with direct financial intervention.

The government has used fuel-price stabilisation measures and tax relief to limit the impact of higher international oil prices.

Ruto said Kenya committed KSh28.19 billion during the April-May and May-June 2026 pricing cycles. The government also reduced VAT from 16 per cent to eight per cent as part of the effort.

That approach gives consumers immediate protection while the government pursues longer-term energy-security measures.

South Africa Uses Temporary Levies

South Africa has relied heavily on temporary fuel-levy reductions.

The government initially cut the general fuel levy by R3 per litre on petrol and diesel from 1st April. It subsequently extended petrol relief and increased diesel relief during May and June.

The objective was straightforward: reduce the immediate burden on motorists and businesses while limiting the inflationary effects of expensive fuel.

However, the government treated the intervention as temporary rather than a permanent replacement for its fuel-pricing framework.

India Turns to Excise Cuts

India has used another fiscal tool.

The government announced a ₹10-per-litre cut in excise duty on both petrol and diesel in March 2026 as international crude prices surged.

Interestingly, the government said the cut would not necessarily translate into an equivalent reduction in retail pump prices. Instead, it would help oil marketing companies absorb part of the international price shock.

The decision demonstrates that tax relief can also be used to protect fuel markets without directly subsidising every litre consumed.

Britain Extends Fuel-Duty Relief

The United Kingdom has continued to use fuel-duty reductions as part of its cost-of-living response.

The government extended its 5p-per-litre fuel-duty cut until December 2026. It also introduced additional support for some commercial road users.

Unlike a permanent subsidy, the measure has a defined time frame.

That allows the government to provide short-term relief while retaining a route back toward normal fuel-duty levels.

Europe Broadens the Safety Net

Across the European Union, governments have also responded to the energy shock.

The European Commission estimated that member states had announced or adopted €14.5 billion in budgetary measures to reduce the social and economic effects of high energy prices as of May 2026.

The measures vary from country to country.

Some governments have targeted households and businesses directly, while others have intervened through taxation, energy support or transport-related measures.

The broader European experience therefore reflects the same policy dilemma facing Nigeria: how to protect consumers without creating a fiscal burden that governments cannot sustain.

What Nigeria Can Learn

The international responses reveal that there is no universal solution to a fuel crisis.

Kenya has used subsidies and tax relief. South Africa has reduced fuel levies temporarily. India has cut excise duties. Britain has extended fuel-duty relief, while European governments have combined several forms of targeted support.

Nigeria, by contrast, is betting on cheaper alternative energy.

That strategy could reduce the country’s exposure to international oil-price shocks if CNG and electric transport infrastructure expands rapidly.

For commuters, however, the critical test is simpler.

Cheaper fuel must eventually translate into cheaper fares.

That will require more conversion centres, more refuelling stations, reliable energy supply and effective monitoring of transport operators.

Without those conditions, alternative-fuel policy may remain a promising long-term strategy while commuters continue to bear the immediate burden of high transportation costs.

The global experience ultimately points to a difficult balancing act: governments must provide relief when citizens need it most while building energy and transport systems that reduce vulnerability to the next international fuel shock.