International Journal of Social Sciences and Management Review

FUEL PRICE VOLATILITY AND EMPLOYEE PSYCHOLOGICAL WELL-BEING IN EDO STATE, NIGERIA: A CONSERVATION OF RESOURCES PERSPECTIVE

Authors: Oyor Godspower PhD, Obasuyi Maxwell PhD & Ruwan David Shadrach

ABSTRACT

Background: Nigeria’s government decision to phase out the fuel subsidy program in May 2023 came at a time of unprecedented price volatility in the country’s petrol pump price, rising from N617 to N897 per litre in 18 months. Although the macroeconomic effects have been reported, the micro-psychological effect on employee health and welfare has been seriously under-studied, especially in Nigeria where the formal transport infrastructure is limited such as Edo state. The aim of this study was to explore the relationship between perceived petrol price volatility and psychological distress amongst commuting employees in Edo State, Nigeria, and to explain this relationship with the Conservation of Resources (COR) theory.

Method: The study used a cross-sectional correlational design, with 399 full time employees who were recruited using stratified random sampling from three Local Government Areas (LGA) namely: Oredo, Egor and Ikpoba-Okha. The participants were asked to respond to the 12 item GHQ-12 and PPVPS-8 in addition to demographic information and commuting variables. Hierarchical multiple regression was used to examine whether petrol price volatility was a significant predictor of psychological distress, controlling for demographic variables.

Results: The prevalence of clinically significant psychological distress was 68.9% (95% CI: 64.2-73.6). Psychological distress showed a strong positive correlation with petrol price volatility, as perceived by the respondents (r = 0.58, p<0.001), thus confirming H₁. After controlling for age, income, commuting distance and vehicle ownership, the petrol price volatility accounted for an additional 17.4% of variance in the distress scores (ΔR² = 0.174, p < 0.001), lending support to H₂. Commuting distance (β = 0.31, p < 0.001) and the absence of vehicle ownership (β = 0.28, p < 0.001) were the strongest demographic moderators.

Conclusion: The high volatility of petrol prices is an independent significant predictor of psychological distress among Edo State employees which is in line with the predictions of the COR theory, which predicts that loss of resources will have disproportionate psychological impacts. The policy recommendations include wage-fuel adjustment mechanisms, employer-sponsored transportation cooperatives and expanded public transit infrastructure.

Keywords: fuel subsidy, petrol price volatility, psychological distress, Conservation of Resources theory, employee well-being, Nigeria, commuting stress.

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