More than 40 prominent detainees have now been freed since General Abubakar was sworn in almost three weeks ago, a few hours after the death of the dictator General Sani Abacha, who, according to the regime, suffered a heart attack.
General Abubakar has also opened negotiations with banned pro-democracy groups and with Moshood Abiola, presumed winner of the annulled 1993 elections, who has spent the past four years in jail.
These developments raise doubts about initial forecasts that General Abubakar would simply be the reincarnation of his detested predecessor.
Western diplomats are taking heart from the developments. The US, Britain and other European countries, which made a political, though not an economic, pariah of oil-rich Nigeria, are now beginning to treat General Abubakar like an African Gorbachev
Yesterday, the British foreign minister, Tony Lloyd, visited General Abubakar on behalf of the European Union, and Chief Emeka Anyaoku, secretary general of the Commonwealth, which suspended Nigeria after the execution of writer Ken Saro-Wiwa. The US is promising a high-level delegation as soon as Nigeria is ready to receive it.
Opposition figures warn that the West's enthusiasm is premature. Abubakar is promising a return to civilian rule, but so did a long line of military rulers before him. "So far, so good," insisted US State Department spokesman James Rubin earlier this week. "There have been signals that ... General Abubakar wants to get the army away from its role as acting outside civilian rule of Nigeria."
On Thursday, Susan Rice, US assistant secretary of state for African affairs, said in Nigeria the stakes were "enormous". A democratic Nigeria she said was the key to a stable and prosperous West Africa and an invigorated continent. There are fears that Nigerian instability might lead to a return to conflict in Sierra Leone, where Nigerian troops ironically helped restore a democratically elected government.
But the US's desire to welcome back Nigeria into the international fold is driven by more than concern about the region. A reformed Nigeria would end an embarrassment at home - though it has been scathing about Nigeria's human rights record the US has continued to guzzle up its oil. Last year, the US doubled its oil purchases to $6bn.
Little is known about General Abubakar, who is believed to be the military junta's compromise candidate. But US and European diplomats pin their hopes on a few established details which seem to set him apart from General Abacha. While General Abacha was the master of murky, military politics, the more low-key General Abubakar, 55, a Muslim from northern Nigeria, has risen through the ranks, steadfastly avoiding politics and somehow sidestepping the endless coup plots, show trials and purges of the senior ranks.
After fighting in Nigeria's civil war in the late 1960s and serving as a UN peacekeeper in Lebanon in the 1980s he is one of only a few soldiers to have risen to the rank of general without holding government office. His associates insist he has never had political ambitions.
Observers hope he belongs to a faction of the armed forces now believed to regret the trashing of their reputation and integrity - to say nothing of the country's - by military rule. It is unclear just how numerous and influential they are.
But the armed forces, the largest in Africa, are split over the way ahead.
Some believe General Abubakar's hand is strengthened by his close association with former military leader Ibrahim Babangida, who recently emerged from a five-year silence as a born-again critic of military rule. There is speculation that Mr Babangida is planning a political comeback as a civilian or that the two men share the view that the military should get out of politics.
With General Abubakar's support, along with his true game plan, hard to gauge, it is wise to remember that compromise candidates elected by divided groups can find themselves in dangerously, even fatally, weak positions.