Impact Of Petroleum Product Subsidy On The Consumption Of Petroleum Products In Nigeria:- Umeh Peter C

ABSTRACT

The study focused on the effect of fuel subsidy on average cost of living in Nigeriaspanningfrom 1981 lo 2018. The objectives of the study were to examine the effects of fuel subsidy on the average cost of living in Nigeria and to determine the dynamic effect of fuel subsidy on the average cost of living in Nigeria. The study employed Ordinary Least Square technique. The study revealed that; government expenditure on oil imports has a negative and significant impact on average cost of living in Nigeria, government expenditure on natural gas has a negative and significant impact on average cost of living in Nigeria and government expenditure on fuel has a negative but insignificant impact on average cost of living in Nigeria. Based on finding, the study recommended that; despite the significant effect, there is need for the government to increase fuel subsidy to boost the average cost of living in Nigeria. Government should investment more on natural gas and oil importation. This will be visible in the economy