Protesters clash with police after petrol subsidy ends

AFP - Police fired tear gas at protesters in the Nigerian capital Monday as anger mounted after the government ended fuel subsidies, more than doubling petrol prices in the poverty stricken country.

The move announced Sunday in Africa's most populous nation and largest oil producer, saw petrol prices rocket to about 140 niara (0.66 euros, $0.96) per litre on Monday from 65 niara, where the price had been artificially held.

Most Nigerians live on less than two dollars a day.

Queues formed Sunday and again on Monday, a public holiday, with drivers hoping to purchase fuel before prices rise further and fearing a strike by tanker drivers will result in a shortage.

In Lagos, the country's largest city, and in the capital Abuja, an initial rush on petrol stations died out later Monday, but there were fears of what lay ahead Tuesday when Nigerians return from the Christmas holidays.

Police fired tear gas to break up a protest in Abuja, according to video taken by local Channels television and seen by AFP.

The demonstration included former member of parliament Dino Melaye, and the video appeared to show security agents taking him away, with several hundred people present.

Police said they had dispersed people blocking a road, but did not confirm that tear gas was used.

"A group of people whose identities were not known were blocking a public highway, obstructing the movement of vehicles," said police spokesman Yemi Ajayi. "They were dispersed."

Melaye had earlier organised the signing of a petition near the capital's main parade ground, Eagle Square, which armed soldiers and policemen had cordoned off to bar more people from joining the early protest arrivals.

"The essence of this is to mobilise Nigerians to register their displeasure against the satanic increase of the pump price of petroleum products," Melaye told reporters earlier.

"It is also to kickstart a mass protest that will follow ... The battle to fight this is a battle of no retreat, no surrender."

Protests of several hundred people broke out in Kano, the largest city in Nigeria's north, with a student leader threatening riots if the decision was not reversed, while the country's main labour unions warned of mass action.

"We intend to work with other groups to completely paralyse the government and make the country ungovernable," said Denja Yaqub, assistant secretary general of the Nigeria Labour Congress.

Protest threats in Nigeria have often fizzled out in the past, but the fuel subsidy issue is one of the few that unites much of the vast country, with widespread popular opposition to the move.

Economists and government officials view removing the subsidy as essential to allowing for more spending on the country's woefully inadequate infrastructure and to ease pressure on its foreign reserves.

Nigerians however see the subsidy as their only benefit from the nation's oil wealth.

The government says more than $8 billion was spent in 2011 on fuel subsidies.

Nigeria refines very little of its crude despite being a major oil producer and OPEC member, a situation blamed on corruption and mismanagement, forcing the country to import fuel even while it exports crude.

Subsidies were supposed to keep pump prices low even though fuel is imported at market prices, but there have been serious questions over how the subsidy cash has been paid out.

There have been accusations that much of the money goes to corrupt elites. Fuel was also sold above the set price in many areas outside of major cities.

The new policy deregulates the sector, though prices will still have to be in line with a benchmark rate to be posted regularly on the Petroleum Products Pricing Regulatory Agency website. The rate will be in line with market conditions.

President Goodluck Jonathan along with his highly respected central bank chief, Lamido Sanusi, and the finance minister, ex-World Bank managing director Ngozi Okonjo-Iweala, pushed hard for the subsidy removal.

They have argued that it is key to unlocking development in a country that has been unable to provide even sufficient electricity to its population despite its oil wealth.

Years of deeply rooted corruption have resulted in profound distrust of government officials in Nigeria.