By Randy Fabi

ABUJA, July 14 (Reuters) - Nigeria's gasoline tanker drivers suspended a nationwide strike that had sparked panic fuel-buying after the government pledged to lower the cost of diesel, a senior union official said on Monday. "We suspended our action on Saturday night after promises from the oil minister that he would find a way to subsidise fuel prices," said Pius Ikechi, the deputy president of the Nigerian Union of Petroleum and Natural Gas workers.

Global fuel prices have risen by 50 percent since the start of 2008, triggering protests around the world and raising fears of runaway inflation. U.S. crude climbed to a record high above $147 on Friday.

Long lines formed at gasoline stations in the capital Abuja, the commercial hub Lagos and other major Nigerian cities over the weekend as drivers, many of whom waited for several hours in queues, feared the strike would disrupt supplies.

Panic buying is not unusual in Nigeria, which relies heavily on fuel imports but whose distribution network is chaotic.

Nigeria is the world's eighth largest crude oil exporter but its four state-owned refineries are not fully operational, largely due to mismanagement and vandalism, costing it some $4 billion in fuel imports each year.

The union said it would give the government two weeks to come up with a plan to lower diesel prices, which have risen 110 percent in the past few months to around 170 naira ($1.44) per litre. If no action is taken, thousands of its drivers would return to the picket line, Ikechi said.

"We would like prices to return to around 80-90 naira per litre," he said.

Oil Minister Odein Ajumogobia and Finance Minister Shamsuddeen Usman were expected to meet this week to find ways to increase fuel prices subsidies and stave off another strike.

In June, the government was forced to freeze domestic gasoline prices for another six months to prevent mass protests by workers and civil groups. (For full Reuters Africa coverage and to have your say on the top issues, visit: http://africa.reuters.com/ ) (Editing by Nick Tattersall)

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