Nigerian motorists and unions vented their anger on Monday at a sudden more than doubling of fuel prices, a day after government subsidies were removed in a sweeping economic reform that could trigger mass protests.

Opposition leaders, unionists and local rights groups have condemned the move by the state's fuel regulator, which they say will heave up prices at a time when many Nigerians, the majority of whom live on less than $2 per day, already find fuel too expensive.

Many fuel stations in the capital Abuja and main commercial city Lagos were shut on Monday while they waited to figure out how to adjust their prices. Those that were open were jammed with queues and selling at prices of up to 150 naira ($0.92) per litre, up from a fixed price of 60 naira before.

This is a bad New Year present from the government, said David Akpe, a motorist at pump in Abuja, as a queue of about 30 cars formed behind him. What next?

The measure risks bringing public wrath down on President Goodluck Jonathan, who says it is needed to reform the economy.

Don't push us to the street; for we went to the street to make you president and would not like to go to the street to remove you as president! the Conference of Nigerian Political Parties (CNPP), an opposition umbrella group, warned.

Responding to a call to demonstrate, about 500 people marched through the northern city of Kano with placards saying 'No to subsidy removal' and 'Jonathan wants to kill Nigerians'.

A few dozen protesters also occupied the area around Eagle Square in central Abuja. In a sign tolerance was likely to be limited for such protests in the capital, police dispersed people with teargas and made some arrests, a Reuters witness saw.

There was no major organised response.

Petroleum sector workers also rejected the price hike.

The Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) rejects (it) as totally unacceptable and a crass display of bad faith, they said in a statement on Monday.

We therefore urge all Nigerians to ... begin immediate mobilisation for the struggle ahead.

LAWMAKERS UNDECIDED

Lawmakers have been divided on the subsidy issue, leaving the future of the measure potentially still in doubt.

Senate spokesman senator Enyinnaya Abaribe said in a statement the Senate had not yet ruled on the subsidy removal, so it was still open to debate.

The subsidies were left out of the 2012 budget, which has yet to be voted on by both houses. To restore the subsidies, lawmakers would have to add them to the budget and find some way of paying for them, probably by cutting expenditure elsewhere.

While it is true that there was no provision for subsidy in the 2012 budget proposal, the Senate ... is yet to reach a consensus on the matter, Abaribe said. Such a decision would take cognisance of the general mood, he added.

Many economists say the fuel subsidies were hugely corrupt, wasteful and bled money from the treasury into the pockets of rich fuel importers. Some Nigerians see sense in ending them.

The people against the subsidy removal are the people who have been milking Nigeria, said retired banker Peter Madu. The labour unions are just being selfish.

But the unpopular policy of removing subsidies remains a political bombshell, as most Nigerians see the subsidies as the only benefit they derive from living in an oil rich country.

Nigeria produces more than 2 million barrels per day of crude oil, but a lack of investment in refineries and infrastructure means almost all of it is exported, while refined products such as gasoline have to be imported at great cost.

Going ahead with the plan will save the Treasury more than 1 trillion naira (3.95 billion pounds) in 2012, according to the government, which was heavily criticised by the International Monetary Fund (IMF) for the wasteful use of public funds.

(Additional reporting by Tim Cocks in Abuja, Chijioke Ohuocha in Lagos and Anamesere Igboeroteonwu in Onitsha; Writing by Tim Cocks; Editing by Matthew Jones)