The mushrooming scandal seems certain to become a core issue in the run-up to 2015 presidential elections in Africa's most populous state -- and one of the continent's top oil producers -- and may imperil Jonathan's prospects of another term.
The Financial Times warned the suspension of Gov. Lamido Sanusi, a globally respected banker who won international acclaim for cleaning up Nigeria's banking system after a 2009 financial crash, and the political convulsions of the scandal are undermining international investor confidence in the country.
Jonathan's office said in a statement Sanusi's "tenure has been characterized by various acts of financial recklessness ... inconsistent with the administration's vision of a Central Bank propelled by the core values of focused economic management."
It accused Sanusi of "far-reaching irregularities," which it did not detail.
Nigeria is considered one of the most corrupt states in a continent where official graft is deep-rooted, and its oil industry, which the Financial Times calls "notoriously opaque," has long been suspected of widespread malfeasance.
Sanusi, who has battled to maintain the central bank's independence since he was appointed governor in June 2009, wrote to Jonathan in September that oil worth $50 billion sold by the state-owned Nigeria National Petroleum Corp. had not been paid into state accounts.
Earlier this month, with no apparent move by the government to tackle the allegations, Sanusi -- sidestepping Jonathan's office -- provided a dossier containing hundreds of pages of data, expert and legal opinion in the form of contracts to Senate investigators, in support of his allegations of major fraud at the NNPC.
He alleged the state had lost $20 billion between January 2012 and July 2013 in an alleged subsidy racket that was short-changing the government by as much as $1 billion a month.
Gasoline subsidies are believed to cost Africa's second-largest economy, after South Africa, $7 billion a year. That keeps the cost of gasoline down to 41 U.S. cents a liter -- and ditching the subsidies would push that up to $74 cents, a price few of Nigeria's 150 million people, can afford as most live on $2 a day.
The government has revealed that the chief beneficiaries of the subsidies are the 100 or so companies owned by Nigeria's wealthiest people.
The Economist reported recently that the NNPC deliberately overestimated the cost of importing refined products, made necessary because the NNPC has failed to build more refineries while billions of dollars for renovating the four existing refineries have vanished over the years.
The key beneficiaries of the imported fuel are the middlemen, who allegedly siphon off much of the cheap fuel, and then smuggle it into neighboring countries where unsubsidized fuel costs three times what it does in Nigeria, The Economist said.
The Senate Thursday ordered a forensic audit of the NNPC, which has repeatedly denied allegations of financial wrongdoing. But Sanusi's allegations has sent shockwaves through the oil industry and Nigeria's political elite.
There have long been accusations that oil revenues go astray during election cycles to fund political campaigns.
Jonathan, who hails from the Christian south where Nigeria's oil reserves lie, has come under increasing attack by his political opponents, mainly in the Muslim north, who seek to exploit his administration's woes.
This includes Jonathan's failure to crush a worsening insurgency by Islamist militants in the northeast in which thousands of people have been killed.
In December, 37 members of the National Assembly crossed the floor to join the opposition, costing the ruling People's Democratic Party its majority for the first time since Nigeria was returned to civilian rule in 1999 after a series of highly corrupt military regimes.
Political observers believe Jonathan is in for a rough electoral ride.
Dumping Sanusi was widely seen as a politically motivated move by Jonathan, who the Financial Times reported had tried to force the governor out in recent weeks as the oil revenue scandal snowballed.
Sanusi antagonized other members of the government, particularly Finance and Economy Minister Ngozi Okonjo-Iweala, infuriating them when he went public with his allegations in December.