Playing the fuel: reforming Nigeria’s subsidies

Nigerians are facing significant changes as the new Dangote refinery begins operations. For years, Nigeria had to rely on importing refined petrol due to a lack of local refining capacity, despite having ample oil reserves. Previously, government subsidies kept petrol prices artificially low, making it affordable for the public. However, these subsidies strained public spending. Now, with locally refined petrol expected to cost closer to market prices, Nigerians may experience higher costs at the pump. This transition is essential to ensure better management of public resources and improve the overall economy, yet it comes with potential challenges for households accustomed to subsidized prices. The shift will test the resilience of Nigerians as they adapt to these changes, which could signify a larger economic transformation in the future.

Fuel shortages in Nigeria highlight a difficult situation where the government sets petrol prices below market value, leading to scarcity and long queues. Despite being a major oil producer, the nation struggles with funding fuel subsidies, causing corruption and misallocation of resources, ultimately affecting vital services like healthcare. This situation shows the complexities of managing fuel prices and the wide-ranging effects on everyday life. More people are impacted than just car owners, as petrol is essential for generators too, reflecting how deeply embedded fuel issues are in Nigerian society. Mismanagement and insufficient government funding mean that while citizens expect low prices, alternative economic situations develop, leaving everyone frustrated and struggling, especially when fuel is critical for daily activities. This cycle of subsidy mismanagement leads to wasteful spending, diverting funds from important sectors such as health, further complicating the country’s economic challenges.

In Nigeria, petrol subsidies encourage excessive fuel use, benefiting mainly wealthier car owners while straining government resources for public investment. A new mega refinery could boost locally refined petrol supply, but the government must allow market pricing to help it succeed. This situation offers a potential chance for reform, especially as the government faces financial challenges that make subsidies increasingly expensive. If fuel prices rise after subsidy removal, it may lead to public unrest, but the government could use this opportunity to shift blame to business interests rather than accepting responsibility. Past chances for reform have been missed, but current circumstances may force action, especially with rising national oil production expectations.

In Nigeria, recent increases in petrol prices have sparked discontent among citizens who have grown accustomed to paying lower costs due to government subsidies. Despite the economic rationale for removing these subsidies, the sudden jump from prices like 568 Naira to 855 Naira per liter has caused panic and confusion. Long queues outside petrol stations have formed, reflecting a shortage of available fuel. Some are resorting to black market purchases, paying significantly more for gasoline. Everyday life is affected, as many people are choosing to stay home rather than face the challenges of fuel scarcity, which impacts transport and daily activities. An Uber driver shared that many people have cut down on trips to save money, illustrating how deeply the fuel crisis is felt among ordinary Nigerians.

Rising transport costs for food have led to higher prices across Nigeria, sparking protests over living costs. While the government’s plans entail scrapping subsidies, the uncertainty remains on how this money will be used. Investing in education and healthcare could vastly improve productivity, benefiting the populace long-term. However, the immediate concern is how Nigerians will cope with increased costs in the interim. Currently, public spending on education and healthcare is alarmingly low, hampering potential growth. Without proper management of funds saved from subsidies, there is a risk that benefits won’t materialize, leaving people to struggle with enhanced living costs.

People in Nigeria are exploring various options to deal with rising petrol prices, including using hybrid vehicles and solar panels. This shift towards renewable energy could benefit the future, although transitioning from a petrol-dependent economy will take time. In the U.S., Bitcoin mining is facing scrutiny in Texas due to its high energy consumption, despite early support from politicians. Changes in energy regulations might reflect a shift in political attitudes towards cryptocurrencies, particularly after China’s mining ban led to a migration of miners to Texas. These developments highlight how energy demands impact both local economies and politics, emphasizing the need for innovation and adaptation as society seeks sustainable solutions.

Texas has become a popular spot for Bitcoin miners due to its cheap power and libertarian mindset. Initially, miners were welcomed to help stabilize the state's fragile power grid, especially after the 2021 winter storm caused major blackouts. However, as demand for energy soars, Bitcoin mining is now straining the grid instead of helping it. Politicians are concerned as energy demand from mining and other data centers could double by 2030. While miners are exploiting the energy market by operating during peak demand times when electricity prices are high, this places more pressure on the already overburdened grid. Consequently, Texas is becoming a less hospitable environment for Bitcoin miners, as the state's energy challenges grow.

Bitcoin miners in Texas, like Riot, are making more money by reducing their mining due to high energy prices, sometimes earning four times more for not mining. While they argue this is good for the state's energy system, Texans are worried about power shortages during extreme weather. This has led to political tension, as lawmakers consider new bills to limit miners' energy practices. If public frustration grows about power issues, especially during heat waves, it could lead to stricter rules for Bitcoin mining operations in Texas. The situation is tricky as miners are seen as taking advantage of the energy crisis, making both public trust and regulatory responses uncertain going forward.

Joko Anwa, an Indonesian filmmaker, turned his childhood fears into a successful career in horror movies. Growing up poor, he often worried about being unloved and even kidnapped by a mythical ghost. His film 'Satan Slaves' and a recent Netflix series have highlighted Indonesia's rich folklore and horror genre, which dominates the local film industry. In 2023, horror films made up half of all domestic releases, showing a cultural trend. Popular films like 'K.K. and De Desapenari' have achieved great success, indicating a taste for supernatural stories driven by folklore. Joko’s work and the films from Indonesia are finally receiving international attention, showcasing the potential and creativity of Indonesian filmmakers on a global stage.

In Indonesia, horror films are deeply rooted in culture and history, often using ghost stories to teach lessons and entertain. Their popularity surged during and after the New Order regime, creating a unique genre that reflects local beliefs. Recent filmmakers, inspired by international styles, aim for global audiences while honoring Indonesian themes. Streaming platforms like Netflix have helped these films reach wider audiences, potentially fostering new appreciation for Indonesian culture. While some fear the horror might be too local for outsiders, there's optimism that global viewers will embrace it, just as they have with South Korean cinema. Joko, a filmmaker, believes that blending cultural identity with universal themes can lead to success abroad. This revitalization of Indonesian horror showcases the ability of local stories to resonate universally, offering insights into a culture rich in folklore and belief. More recognition for Indonesian horror could lead to greater international interest.