A court in Nigeria has indefinitely extended an earlier decision to ban a controversial fuel tax and a threatened strike by labor leaders.

In Monday's ruling, the Abuja Appeals Court upheld last week's decision that averted a nationwide strike against the one cent tax and an overall rise in fuel prices.

The appeals court is currently hearing arguments from the government and labor leaders on the legality of both the tax and the planned nationwide strike.

The original decision was made in the wake of a last ditch-effort by the government to put an end to the threatened strike.

Union leaders organized the strike following several failed attempts at mediating the crisis. They are protesting a newly imposed one-cent tax on gasoline and an overall increase in fuel prices.

The cost of fuel in Nigeria has shot up from 20 cents a liter to more than 35 cents in the past six months, despite a government pledge in July to cap prices at a lower level.

Nigerian officials say the tax is needed to upgrade the nation's crumbling roads - but union leaders argue ordinary people should not have to pay for economic and social reforms. Although Nigeria is among the top-10 oil producers and exporters in the world, few of its refineries are operational - forcing the government to import refined fuel for the public.