Effect of Fuel Subsidy Removal on Students’ Academic Performance and Cost of Living in Federal Universities in Nigeria
The removal of fuel subsidy in Nigeria has affected many areas of economic and social life, including transportation, food prices, accommodation, education and household spending. University students have been particularly exposed to these changes because many depend on their parents, guardians, scholarships or limited personal income to meet their educational and living expenses.
On 29 May 2023, President Bola Ahmed Tinubu announced the end of the existing petrol subsidy regime during his inaugural address. The immediate increase in petrol prices contributed to higher transportation costs and added pressure to the cost of goods and services. The World Bank reported that the reform contributed to significant short- and medium-term cost-of-living pressures, while inflation reached 33.7% in April 2024.
For students in federal universities, the effects can extend beyond the price paid at a filling station. Higher transport fares can make daily movement to campus more expensive, while increased logistics and production costs can raise the prices of food, accommodation, textbooks, stationery and other necessities.
Research conducted among Nigerian university students has also begun to provide direct evidence of these effects. Studies at Usmanu Danfodiyo University, the University of Ibadan, Federal University Gusau and public universities in South-East Nigeria have reported relationships between the economic consequences of subsidy removal and students’ academic experiences. At least I am from the south East and I have a first-hand experience on the effect of the fuel subsidy removal
What Was Fuel Subsidy Removal in Nigeria?
Fuel subsidy refers to government support that reduces the effective price paid for petroleum products by consumers. Before the 2023 reform, the Nigerian government spent substantial amounts supporting the price of petrol.
The World Bank reported that Nigeria’s gasoline subsidy cost more than ₦8.6 trillion between 2019 and 2022. It also noted that available evidence indicated that the subsidy did not primarily benefit poor households and that the system created opportunities for black-market activity and smuggling.
The policy change therefore had a fiscal and economic rationale. However, removing a subsidy that had kept petrol prices artificially lower also meant that consumers were exposed more directly to market-related fuel costs.
This distinction is important when examining university students. The policy itself did not directly charge students an academic penalty. Rather, its economic effects were transmitted through transportation, food, accommodation, household income and other expenses that influence students’ ability to study.
How Fuel Subsidy Removal Increased Students’ Cost of Living
Higher transportation costs
Transportation is one of the most direct ways fuel price increases affect university students. Students who live outside campus often depend on buses, motorcycles, tricycles, taxis or private vehicles to attend lectures and other academic activities.
When transport operators face higher fuel and operating costs, fares can increase. Students may therefore have to spend considerably more money simply to get to lectures, libraries, laboratories, examinations and other university activities.
A 2025 study of students at Federal University Gusau found that subsidy removal increased transportation costs and reduced students’ participation in extracurricular activities. The researchers linked these changes to indirect effects on academic performance.
Higher food expenses
Food prices can also be affected by higher fuel and transportation costs. Farmers, food processors, wholesalers and retailers depend on transportation and energy at different stages of the food supply chain.
For students, this may mean that the money previously sufficient for daily meals is no longer enough. A student who has to spend more on food may have less money available for textbooks, internet access, transportation, accommodation or other academic needs.
This creates an important connection between the cost of living and academic performance. Financial pressure can affect students even when their tuition or other university charges remain unchanged.
Higher accommodation and household expenses
Accommodation costs can also become more difficult to manage when landlords and property managers face increased maintenance, transportation and energy expenses.
Students who live off campus may consequently experience higher rent and associated costs. Those who live in hostels may also face higher prices for food, transportation and other services surrounding the university environment.
A 2026 study focusing specifically on students at Nnamdi Azikiwe University, Awka, examined the relationship between fuel subsidy removal and the cost of transportation, foodstuffs, house rent and stationery. The study was framed around cost-push inflation and the transmission of transportation costs through the economy.
Higher prices for educational materials
Educational materials can also become more expensive when production and distribution costs rise. Students may need textbooks, notebooks, printing, photocopying, internet data, stationery and other learning resources.
When a student’s available income does not increase at the same rate as these expenses, the student may have to reduce spending on some academic resources.
This is particularly important for students from low-income households because their education-related expenditure competes with basic needs such as food and transportation.
Effect of Fuel Subsidy Removal on Students’ Academic Performance
The effect on academic performance is not necessarily direct. Fuel subsidy removal does not automatically cause a student to obtain lower grades. Instead, economic pressure can create conditions that make successful academic participation more difficult.
Reduced class attendance
Students who depend on public transportation may find it increasingly difficult to travel to campus when transport fares rise.
If transportation consumes a large proportion of a student’s daily allowance, the student may begin to reduce the number of trips to campus. This can result in missed lectures, tutorials, laboratory activities or other academic engagements.
Research involving undergraduate students at the University of Ibadan found that factors associated with subsidy removal, including class attendance, access to course materials and stress levels, significantly influenced academic achievement. The study involved 150 undergraduate students from three faculties and reported that the variables explained 41.1% of the variance in academic achievement in its statistical model.
Because the study was based on a particular sample at one university, its findings should not automatically be treated as representing every federal university in Nigeria. However, it provides useful institution-level evidence of a relationship between economic pressures associated with subsidy removal and academic outcomes.
Difficulty purchasing course materials
A student who spends more money on transportation and food may have less money available for textbooks, handouts, printing and internet data.
This can affect learning, especially in programmes where students need regular access to textbooks, journals, laboratory manuals or online academic resources.
The University of Ibadan study specifically identified course materials as one of the factors through which subsidy-related pressures were associated with academic achievement.
Increased academic stress
Financial difficulty can create additional stress for students. Instead of concentrating entirely on lectures, assignments and examinations, students may spend considerable time thinking about how to pay for transportation, food, accommodation and other necessities.
The study at the University of Ibadan included stress level among the factors associated with students’ academic achievement. Similarly, research at Usmanu Danfodiyo University reported financial difficulties, increased absenteeism and decreased academic performance among the students studied.
Reduced participation in university activities
University education involves more than attending lectures. Students may participate in seminars, student associations, practical activities, academic conferences, sports and other extracurricular programmes.
When transportation and other expenses increase, students may decide that these activities are no longer affordable.
A 2025 study at Federal University Gusau reported reduced participation in extracurricular activities following the increase in transportation costs associated with subsidy removal.
Evidence from Federal Universities and Other Public Universities
Several studies now provide useful evidence, although they differ in location, sample size and methodology.
At Usmanu Danfodiyo University, Sokoto, researchers studied students in the Faculty of Management Sciences. The population was 1,146 students, and 291 respondents were selected using stratified and simple random sampling. The researchers reported a significant relationship between fuel subsidy removal and decreased academic performance.
Another study concerning Usmanu Danfodiyo University reported that students experienced financial constraints affecting educational materials, accommodation and extracurricular activities. It also reported associations with absenteeism and academic achievement.
At Federal University Gusau, a 2025 study examined the effects of petroleum subsidy removal on students’ academic performance. It reported increased transportation expenses and reduced participation in extracurricular activities, concluding that these factors indirectly affected students’ academic performance.
Research covering public universities in South-East Nigeria was broader. The study involved 1,000 undergraduate students drawn from five universities and examined the experiences of students following subsidy removal. Respondents reported problems involving academic participation, university funding, students’ interest in learning and other socioeconomic pressures.
These studies should not be interpreted as proving that every decline in student academic performance after 2023 was caused exclusively by fuel subsidy removal. University students are affected by many other factors, including inflation, exchange-rate changes, household income, accommodation costs, institutional conditions and individual circumstances.
How the Cost of Living Can Influence Academic Outcomes
The relationship can be understood as a chain of economic effects:
Fuel subsidy removal → higher petrol prices → higher transportation and logistics costs → higher prices for goods and services → increased student living expenses → financial pressure → reduced academic participation or concentration → possible effects on academic performance.
This does not mean that every student experiences the same outcome. Students living on campus may face lower transportation costs than students travelling long distances. Similarly, students from households with stronger financial resources may be better able to absorb increases in living expenses.
Family income therefore becomes an important factor in understanding the effect of the policy on students.
Students from Low-Income Households May Face Greater Pressure
The impact of higher living costs is not evenly distributed. A student whose parents have a stable income may be able to receive additional financial support when expenses rise. Another student whose parents are themselves struggling with inflation may have limited access to additional assistance.
This can produce different academic experiences within the same university.
Research at Usmanu Danfodiyo University identified socioeconomic factors such as family income and parental occupation as relevant to the way students experienced the effects of subsidy removal.
This suggests that student welfare policies should consider financial vulnerability rather than assuming that all university students have the same capacity to absorb higher costs.
Effect on Students Who Live Far from Campus
Distance from campus can become an important factor when transportation prices rise.
A student living close to the university may be able to walk or use a relatively inexpensive means of transportation. Another student travelling several kilometres each day may spend a much larger amount on transportation.
Students who travel from neighbouring towns or communities can therefore be especially exposed to increases in transport fares. Some may respond by relocating closer to campus, but this creates another expense because rent and other accommodation costs may also be high.
Others may reduce the number of days they travel to campus, which can affect attendance and participation in academic activities.
Effect on Students’ Personal Time
Economic pressure can also affect how students use their time.
A student who cannot depend fully on family support may take part-time work, small trading activities or other income-generating activities to meet expenses.
Working while studying is not necessarily harmful. In some circumstances, it can provide valuable experience and financial independence. However, when work takes up substantial study time, it may reduce the time available for reading, assignments, revision and rest.
The effect therefore depends on the amount of work, the student’s course requirements, the working environment and the student’s financial circumstances.
Impact on Universities and Academic Staff
The effects of fuel price increases are not limited to students. Universities themselves operate large facilities and depend on transportation, electricity generation, maintenance, logistics and other services.
Higher operating costs can place pressure on university budgets. Academic staff may also experience higher commuting and household expenses.
A 2025 study of academic staff in tertiary institutions in Oyo reported that fuel subsidy removal was associated with increased transportation costs and financial strain among the staff surveyed.
When academic staff and institutions face financial pressures, students may experience indirect effects through teaching, research, supervision, academic support and other university services.
Does Fuel Subsidy Removal Always Reduce Academic Performance?
No single conclusion can be applied to every Nigerian university student.
The available studies report associations between subsidy-related economic pressures and academic difficulties, but most of the student-focused research cited here uses survey or descriptive methods. Such designs are useful for understanding students’ experiences, but they have limitations when establishing a direct causal relationship.
Academic performance is influenced by numerous factors. These include students’ prior academic preparation, teaching quality, learning resources, family background, health, study habits, university facilities and economic conditions.
Therefore, it is more accurate to say that fuel subsidy removal created or intensified economic conditions that can negatively affect academic participation and performance, rather than claiming that subsidy removal alone determines students’ grades.
Possible Ways to Reduce the Burden on University Students
Evidence from the studies reviewed suggests several areas where support could reduce the pressure on students.
Targeted student financial assistance
Financial aid can help students who are unable to meet essential education and living expenses. Support can be targeted at students facing the greatest financial difficulty.
The IMF has also emphasized targeted social protection and cash-transfer systems as part of efforts to cushion vulnerable households from the effects of economic reforms and inflation.
Affordable university transportation
Universities can consider affordable shuttle systems for students living on or around campus. Reliable campus transportation can reduce the number of students who have to depend on commercial transport for daily academic activities.
Scholarships and bursaries
Scholarships and bursaries can reduce pressure on students who cannot afford textbooks, accommodation, food or other essential educational expenses.
Improved student loan access
Student financing can provide another mechanism for students to remain in school when family income is insufficient. However, loan schemes need clear eligibility requirements, accessible application procedures and repayment arrangements that students can realistically understand and manage.
Affordable accommodation
Increasing access to reasonably priced student accommodation can reduce the transportation burden for students who currently travel long distances to campus.
Academic and counselling support
Universities can strengthen academic advising and counselling services for students experiencing financial or academic difficulties. Early identification of students at risk of dropping courses, missing lectures or discontinuing their studies may allow institutions to intervene before the problem becomes severe.
What the Evidence Means for Federal Universities in Nigeria
The available evidence suggests that fuel subsidy removal should be viewed as an educational issue as well as an economic issue.
For students, the most important transmission channels are transportation, food, accommodation, educational materials and financial stress. These pressures can influence attendance, participation, study time and concentration.
However, the strength of the effect differs among students. Location, family income, accommodation arrangements, access to scholarships and the availability of alternative transportation can all influence individual outcomes.
The evidence from Federal University Gusau and Usmanu Danfodiyo University is particularly relevant because both are federal universities. The University of Ibadan and other public-university studies provide additional evidence, but findings from individual institutions should not automatically be generalized to every federal university in Nigeria.
Frequently Asked Questions
What is the main effect of fuel subsidy removal on university students?
One of the most direct effects is increased transportation costs. These higher costs can contribute to increased spending on food, accommodation and other necessities, creating additional financial pressure for students.
Did fuel subsidy removal affect students’ academic performance?
Several Nigerian studies report a significant relationship between subsidy-related economic pressures and academic performance. However, academic performance has multiple causes, so subsidy removal should not be treated as the only factor determining students’ results.
How does fuel subsidy removal affect class attendance?
Higher transportation fares can make daily travel to campus more expensive. Students who cannot afford the additional cost may reduce their trips to campus or miss some academic activities.
How does fuel subsidy removal affect the cost of living?
Fuel prices influence transportation and logistics costs. These costs can feed into the prices of food, accommodation-related services, educational materials and other goods and services.
Are students living off campus more affected by transport costs?
They can be, particularly when they travel long distances to campus. However, the actual effect depends on distance, transport options, location and the student’s financial resources.
Can higher food prices affect academic performance?
Yes. When students struggle to afford adequate food, financial stress and reduced wellbeing can make studying more difficult. Food expenses can also compete with spending on educational materials and transportation.
Does fuel subsidy removal affect students living on campus?
Yes. Students living on campus may have lower daily transportation costs, but they can still experience higher prices for food, stationery, transportation outside campus and other goods and services.
What students can be affected most by rising living costs?
Students from households with limited income may have less capacity to absorb higher costs. Students who travel long distances or lack access to financial assistance may also face greater pressure.
Can student loans reduce the effect of higher living costs?
Student loans can provide additional financial support, but their effectiveness depends on accessibility, adequacy of funding and the terms under which the loans are provided.
What can universities do to help students?
Universities can consider affordable transportation, scholarships, bursaries, student welfare programmes, academic counselling and reasonably priced accommodation.
Did subsidy removal increase transportation costs for students?
Research involving students at Federal University Gusau and other Nigerian universities has reported increased transportation costs following subsidy removal.
Can transportation costs affect extracurricular activities?
Yes. When transportation becomes more expensive, students may reduce participation in activities that require additional movement around or outside the campus. This effect was reported in the Federal University Gusau study.
Does subsidy removal affect university lecturers?
It can increase commuting and other living expenses for academic staff. Research involving tertiary academic staff in Oyo reported financial and transportation pressures associated with subsidy removal.
Is fuel subsidy removal the only reason for rising student expenses?
No. Exchange-rate movements, general inflation, food supply conditions, accommodation demand, energy costs and other economic factors can also affect student expenses. The World Bank and IMF have both identified multiple factors behind Nigeria’s inflation and cost-of-living pressures.
Can the findings from one federal university represent all federal universities?
No. A study at one institution provides evidence about that institution and its sampled population. Conditions can differ considerably between universities because of location, transport systems, accommodation markets and student socioeconomic backgrounds.
Summary
Fuel subsidy removal has created significant economic pressures for Nigerian households, and university students are among the groups exposed to these pressures. Higher fuel prices can increase transportation costs and contribute to broader increases in the cost of food, accommodation, educational materials and other necessities.
Evidence from studies conducted at Federal University Gusau, Usmanu Danfodiyo University, the University of Ibadan and other public universities indicates that these pressures can be associated with reduced class attendance, difficulty obtaining academic materials, increased financial stress, reduced extracurricular participation and poorer academic outcomes among some students.
At the same time, the evidence should be interpreted carefully. Fuel subsidy removal is one part of a much wider economic environment, and individual academic outcomes depend on several factors. The strongest conclusion supported by the available research is that rising living costs can create barriers to effective university participation, particularly for financially vulnerable students.
For federal universities, student welfare measures such as targeted financial assistance, affordable transportation, scholarships, accessible accommodation and academic support can help reduce the educational consequences of severe financial pressure.
References
Faruk, B. U. (2025). Analysis of the Impact of Petroleum Subsidy Removal on Students’ Academic Performance: A Case of Federal University Gusau, Zamfara State, Nigeria. Economic Analysis Letters, 4(3), 89.
Garba, F., & Idris, S. (2024). Effect of Fuel Subsidy Removal on Students’ Academic Performance in Tertiary Institutions in Sokoto State: A Study of Usmanu Danfodiyo University, Sokoto. UMYU Journal of Accounting and Finance Research, 7(1), 1–10.
Muibi, T. G., Quadri, G. O., & Ukpere, W. I. (2025). Assessing the Effects of Fuel Subsidy Removal on Students’ Academic Achievement. Journal of Information Systems Engineering and Management, 10(52s).
Offor, U. I., & Ego, N. P. (2024). Challenges of Fuel Subsidy Removal on Academic Engagements of Undergraduates in Public Universities in South-East Nigeria. International Journal of Research and Innovation in Social Science, 8(5), 1555–1563.
World Bank. (2024). Turning the Corner: Nigeria’s Ongoing Path of Economic Reforms.
International Monetary Fund. (2025). Nigeria: 2025 Article IV Consultation.
Effect of Fuel Subsidy Removal on University Students in Nigeria
Explore how fuel subsidy removal affects students’ academic performance, transportation, food, accommodation and cost of living in Nigerian federal universities.
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