Nigeria Fuel Protest

Take away what people need to live - food, water, shelter and gasoline - and there's bound to be trouble.

The government of Nigeria has learned this the hard way after it decided to end fuel subsidies last week, causing fuel prices to spike 88 cents in one day in a country where most people earn less than $2 per day. Hundreds of thousands of Nigerians began a strike this week to protest against the decision.

Protests broke out in Lagos, Nigeria’s largest city, where at least one protestor was killed by a police officer.  In Kano, several hundreds of thousands gathered for a “sit-in”, and in Minna two police officers were killed on Wednesday when a mob tore through the city, burning political offices and prompting an 24-hour curfew.

On Thursday, Nigerian oil workers warned they would shut down production on Sunday - a serious threat in a country that is Africa's top crude exporter and the eighth largest oil exporter in the world. A strike could be disastrous for Nigeria, which receives two-thirds of its government revenues and over 90% of its export earnings from the industry. Union leaders met with President Goodluck Jonathan on Thursday in the hope of finding a compromise.

How much the two sides are willing to compromise is unclear. Government officials have said that removing the subsidies was critical to improving the country's inadequate infrastructure. With the $8 billion that the government saves from no longer subsidizing fuel, it says it can improve roads and other public projects.

Folorunso Oginni, chairman of the nation's oil union, the Petroleum and Natural Gas Senior Staff Association of Nigeria, told CNN that the Sunday deadline to shut down oil production is still in effect unless the government and labor union can reach an agreement, which would include reinstating the subsidies and returning fuel costs to earlier levels.

Cutting off subsidies caused not only gas prices to surge, but transportation and food costs as well. Nonetheless, foreign operations are still pumping oil out of Nigeria.

Nigeria produces about 2.4 million barrels a day. Royal Dutch Shell PLC says they are monitoring the situation. Chevron Corp., Exxon Mobil Corp., Italy’s Eni SpA and French firm Total SA also operate in Nigeria in conjunction with the state-run Nigerian National Petroleum Corp.

(Photo © AP)