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Business News

Nigerians might be hit with higher ticket price as airlines battle fuel scarcity, fuel price increase 

Nigerians should brace up for a possible hike in ticket price as airline companies are struggling to lay their hands on aviation fuel (known as Jet A1). The scarcity has led to a price hike in the market.

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Aviation sector to contribute over N1.2 trillion to Nigeria's GDP by 2020, Nigerians might be hit with higher ticket price as airlines battle fuel scarcity, fuel price increase , Aviation: Aviation sector gasps for stimulus in worst ever crisis

Nigerians should brace up for a possible increase in ticket price as airline companies are struggling to lay their hands on aviation fuel (known as Jet A1). The scarcity has led to a price hike in the market.

Fuel marketers are said to be selling to the highest bidders. This means that only the airline companies which are willing to pay more are getting get fuel.

It was disclosed that the price of aviation fuel had gone up from N200/N220 to between N250, N255 and N270. This rise in price seems to have no end for the moment, and if the scarcity continues, there is a certainty that the price will keep rising. 

[READ MORE: Ethiopian Airlines leaves Enugu Airport to begin flight operation in Rivers State]

Aviation fuel, fuel price, scarcity

According to a report, the fuel price is higher in Abuja compared to Lagos State.

“Price has increased and domestic airlines, especially when they want to refill in Abuja, have to prepay and wait to be allocated. But in Lagos, it is cheaper than outstations because of the time it takes for trucks to get to those places,” an inside source said in the report. 

While the reason for the scarcity is not known yet, a marketer disclosed that, “We don’t produce aviation fuel. So, if something happens at the point of importing it, the marketers can spread the cost.”

Impact of the fuel price hike: The scarcity seems to have changed the routine operation of the domestic airlines, as they are now compelled to pay ahead in order to get the aviation fuel before their flight operation. 

This might also cause flight delays. Already, in the first six months of this year, the aviation sector recorded 16,429 flight delay, and that number might significantly increase if the fuel scarcity lingers for a long period. 

Also, fuel scarcity and increase in fuel price might affect flight tickets, as airline companies might not want to bear the cost alone. The domestic airlines might spread the cost around just like the fuel marketer did because fuel accounts for 30% to 40% of Airline’s operation costs. 

[READ ALSO: Med-View Airline clears the air over operations suspension claim]  

Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

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Real Estate

FG to unveil dedicated portal for sale of houses to Nigerians

The Federal Government has announced plans to launch a dedicated web portal for the sale of buildings to Nigerians in the next few weeks.

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Nigeria needs N1.5 trillion within the next 3 years to fix roads - Fashola

The Federal Government has announced plans to launch a dedicated web portal for the sale of buildings to Nigerians in the next few weeks.

The platform is expected to help contributors to the National Housing Fund (NHF) access mortgage loans on a first-come, first-serve basis.

This disclosure was made by the Minister of Works and Housing, Babatunde Raji Fashola while speaking at the ninth meeting of the National Council on Lands, Housing and Urban Development in Jos, Plateau State.

Fashola, who was represented by the Minister of State for Works and Housing, Abubakar Aliyu, pointed out that the ministry is currently at the completion stages of the first phase of the national housing programme in 34 states of the federation, which provided land for it.

He said, “We urge the state governments to alert their residents to this opportunity for interested persons to apply.”

Fashola commended the Federal Mortgage Bank of Nigeria (FMBN) for being at the forefront of the cooperative housing initiative at the federal level, adding that it has the advantage of allowing cooperative members to choose what they design and build to fit their budgets.

They can leverage their members to get group discount for the purchase of building materials as well as the engagement of contractors.

Fashola disclosed that FMBN as the driver of the housing initiative has engaged 86 co-operatives in projects; approved N35, 784 billion cumulatively; disbursed N10.95 billion; and processed as at January, 57 co-operative housing development loans.

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Fashola emphasized that what the Federal Government can do directly in housing is limited compared to what states can do, just as state governments are also limited, compared to what the private sector and individuals can do.

He said, “The majority of houses available for sale or rent belong to individuals and private companies compared to what states or Federal Government has available. Therefore, many of the tenants who owe rent, who face eviction or who seek to rent or buy property are dealing with private citizens or companies and less so with government agencies.’

My recommendation for improving access and affordability to housing in the Covid-19 era is for private companies and individuals to give back some of what they control to citizens in the way the Federal Government has given back to citizens some of what it controls.’’

He explained, “for example in cases where the rent of businesses or individuals are due for renewal, the private landlords can give back, by accepting monthly, quarterly or half-yearly rent instead of one year, two or three years rent in advance.”

Bottom line

Nigeria has been bedevilled by a housing crisis that has left Africa’s most populous nation ill-equipped to properly provide accommodation for its citizens and inhabitants.

Some of the housing problems in the country include unresolved rent tenure arrangements, high cost of building materials, access to infrastructure, deficiency of housing finance arrangements, stringent loan conditions from mortgage banks, time to process legal documents and inadequate government housing policies.

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Coronavirus

Covid-19: Nigeria committed to procuring 29 million J&J vaccines

The Nigerian Government is still committed to acquiring 29.59 million doses of Johnson & Johnson covid-19 vaccines through the Afrixem Bank AVAT initiative. 

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AstraZeneca suspends COVID-19 vaccine final stage trial over safety concerns, COVID-19: J&J starts vaccine trials on humans after success on monkeys

The Nigerian Government says it is still committed to acquiring 29.59 million doses of Johnson & Johnson covid-19 vaccines through the Afrixem Bank AVAT initiative.

This was disclosed Mrs Zainab Ahmed, Minister of Finance at the recent ‘Collaborative Africa Budget Reform Initiative (CABRI) General Assembly webinar.

What the Minister said

“Therefore, the supplementary budget for COVID-19 vaccines will cover the cost of additional vaccines over and above those provided by COVAX, as well as the full cost of operations and logistics for delivering the vaccines around the country.

Already, the sum of N29.1 billion has been released from the Routine Immunization budgetary provision (Service Wide Vote) to the National Primary Healthcare Development Agency (NPHCDA) as an advance for the operational cost of deployment of the COVID-19 vaccines. The N29.1 billion represents about 52 percent of the amount required over 2021-22,” she said.

She added that FG plans to vaccinate 70 percent of eligible (18 years and above) Nigerians over the 2021 and 2022 fiscal years, with the COVAX agreement willing to cover 43.1 million of the eligible population.

In case you missed it

The World Health Organization (WHO)  announced the approval of China’s Sinopharm vaccine for Covid-19 vaccination. The vaccine is reported to have 79% efficacy against covid.

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