Impact of Fuel Price Increaseon the Nigerian Economy

Everybody appreciates the fact that when motorists pay more for fuel, the transport fare increases. This has been the case even when the increase is only marginal. In the particular case where the cost of fuel is expected to double, the increase in transport fare will be astronomical. This will in turn affect everything else – school fees, house rent, just name it. Therefore, this study took a critical look at the impact of Fuel price increase on the Nigerian economy(Whether negative or positive).The study adopted a survey research design approach to evaluate the level of effect the fuel price increase has on the Nigeria economy. The population of the study is made up of Civil Servants-CS, market men and women-MMW and staff in the private sectors-SPS concerned with petrol and gas affairs. A sample size of 120 persons was selected at random. It was distributed as follows: Civil Servants (18), market men and women (55) and staff in the private sectors (47). A pre test was conducted and outcome yield “r” = 0.92 indicating a high degree of consistency and reliability. The instrument was 8- term survey questionnaire with a- 5 Likert scale response options of Very Relevant (VR), Relevant (R), No Effect (NE) Irrelevant (I), and Very Irrelevant (VI). The questionnaire was structured in line with the research objectives, questions and hypothesis of the study. The Pearson product moment correlation coefficient was used to confirm formulated hypotheses. Finding revealed that there is a significant relationship between the recent increases in fuel prices and economic growth in Nigeria. It was also discovered that the Nigeria economy is not developing because of the effect of fuel price hike on purchasing power and finally the finding showed tha