Nigeria’s Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, has warned that restoring the petrol subsidy could trigger capital flight and push the naira to between ₦3,000 and ₦4,000 per dollar.
Oyedele said international and domestic investors could withdraw their funds if the Federal Government reversed the subsidy removal policy, putting additional pressure on the naira and potentially increasing petrol prices.
He spoke during a press briefing on the sidelines of the 2026 International Monetary Fund and World Bank Annual Meetings in Bangkok, Thailand.
The minister cautioned that restoring the subsidy could undermine investor confidence and expose Nigeria to severe economic consequences.
“If, for any reason, Mr. President says we are considering just that, we are considering return of subsidy on fuel, you know this thing that is happening to Indonesia, it will be a child’s play,” he said.
Oyedele added that investors would likely move their funds out of Nigeria if the government announced plans to restore the subsidy.
“Because at the end of the day, capital will leave once you say that, because they know what it means,” he said.
The minister cited Indonesia’s recent stock market losses as a warning about the possible consequences of policies that weaken investor confidence.
Indonesia’s benchmark Jakarta Composite Index fell by 11.6 per cent on Friday after index provider MSCI raised concerns about market accessibility and threatened to reclassify the country as a standalone market.
Figures cited during the briefing showed that Indonesia’s stock market had declined by about 40 per cent over the year, while Nigeria’s stock market had gained 59 per cent over the same period.
Oyedele warned that capital outflows could weaken the naira significantly and make petrol more expensive, potentially undermining the purpose of restoring subsidies to ease the cost of living.
“So when capital leaves, your effects will struggle. So Naira crashes. 3,000, 3,500, 4,000. The fuel that they want to subsidise, they will be wishing for 1,400 per litre,” he said.
He also warned that wealthy Nigerians and members of the middle class could move their savings from the naira into foreign currencies, increasing demand for dollars.
“Even Nigerians, the elites, the middle class, the high net worths, they will move away from Naira, they will start buying dollars. These were things they did before, so we are not making it up. They start moving against Naira,” he said.
According to the minister, the combination of foreign capital outflows and increased domestic demand for foreign currencies could have serious consequences for ordinary Nigerians.
“So capital is exiting, Nigerians are moving against Naira. This is the perfect combination for the storm, for the devastating impact. So if that happens, who suffers? It’s not Mr. President that will suffer the most, it’s the average Nigerian,” he said.
The warning comes as the Federal Government continues to defend the removal of the petrol subsidy amid calls for measures to ease the rising cost of living.