FG, States Target Lower Transport Fares From October 1

The Federal Government and the 36 state governments have agreed to work towards reducing transportation costs from October 1 by taking advantage of cheaper Compressed Natural Gas (CNG) and electric vehicles.

President Bola Tinubu announced the plan after meeting with state governors at the State House in Abuja. He said cheaper fuel should translate into lower transport fares, with a joint federal-state committee expected to begin work immediately on measures to reduce transportation costs.

According to Tinubu, CNG-powered vehicles can spend between 60 and 80 per cent less on fuel than petrol-powered vehicles. He said the savings from the energy transition should be passed directly to commuters, particularly those who rely on intra-state transportation.

The President said more than 120,000 vehicles had already been converted to CNG under the Presidential CNG Initiative, while over 100,000 additional conversion kits were being processed. He added that the government was expanding conversion centres and refuelling infrastructure across the country.

Tinubu also disclosed plans for another 500 CNG refuelling stations, in addition to 500 stations previously approved, bringing the planned nationwide network to 1,000 stations. He said the Midstream and Downstream Gas Infrastructure Fund was also financing more than 100 gas projects, including 15 CNG mother stations and 86 daughter stations.

The Nigeria Governors’ Forum had earlier agreed to collaborate with the private sector on the National Affordable CNG Transit Programme. The initiative is expected to support CNG vehicle conversions, fleets and infrastructure while encouraging participating transport operators to reduce passenger fares.

Bayelsa State Governor Douye Diri, who spoke for the governors, said lower transportation costs could also help reduce the prices of food and other goods because transport expenses contribute to the cost of moving products from one location to another.

The governors also rejected claims that states had failed to account for funds received from the removal of petrol subsidy. According to figures presented by the Federal Ministry of Finance, proceeds from subsidy removal between June 2023 and December 2025 stood at N15.8 trillion, with N5.4 trillion allocated to the Federal Government, N6.5 trillion to states and N3.9 trillion to local governments.

Tinubu said reducing transportation costs would require cooperation between the Federal Government, states and the private sector. He maintained that the benefits of cheaper CNG and electric transportation should reach Nigerians directly as both levels of government work towards the October 1 target.