Oil Revenue Shakeup: States Back Tinubu’s Executive Order on Direct Remittances

State governments have thrown their weight behind President Bola Tinubu’s Executive Order 9 on the direct remittance of oil and gas revenues into the Federation Account, describing the policy as a step toward improving transparency and enforcing constitutional provisions on public funds.

The Chairman of the Forum of State Commissioners of Finance, Akintunde Oyebode, said the order is not primarily about increasing state earnings but about correcting structural issues within the management of federation revenues. Speaking during an interview on Arise News, Oyebode explained that the directive is expected to add roughly N1.5 trillion to the Federation Account through management fees, frontier exploration charges, and gas flaring penalties.

According to him, the projected increase is relatively small compared to the overall scale of the Federation Account, which he said receives inflows exceeding N30 trillion annually. He stressed that the main objective of the executive order is to ensure compliance with constitutional provisions regarding how oil revenues are collected and distributed, while also addressing leakages linked to the Petroleum Industry Act framework.

President Tinubu signed Executive Order 9 in February 2026, mandating that all oil and gas revenues due to the federation be paid directly into the Federation Account. The directive seeks to limit deductions and retentions by agencies, requiring statutory inflows to be fully remitted before any spending or appropriation takes place.

However, the policy has sparked debate across the petroleum sector. Labour unions, including the Petroleum and Natural Gas Senior Staff Association of Nigeria, have expressed concerns that the order could negatively affect industry operations and investor confidence. The union has urged the Federal Government to reconsider the directive.

Despite the criticism, Oyebode maintained that the reform is about strengthening fiscal discipline rather than delivering a financial windfall to states. He emphasized that ensuring transparency and proper custody of national revenues remains the key priority of the new policy.