The cost of purchasing a 12.5kg cylinder of household cooking gas in Nigeria has increased to N8,500, as at March 28, 2022, from N7,000 recorded in September 2021. A cursory look at the data shows that the price increased to its highest level in over three years. Specifically, a 12.5kg cylinder of household cooking gas increased to its highest since November 2018.
This was confirmed by our analyst after conducting interviews with dealers and consumers, who lamented over what they described as a progressive hike in the price of Liquified Petroleum Gas (LPG), commonly known as cooking gas, across major cities in Nigeria.
According to them, the cost of gas is a major concern because most homes use gas cylinders. They added that they may resolve to using charcoal for cooking.
Read: NCDMB to produce 10% local cooking gas demand
What consumers are saying
In a recent interview with Nairametrics, Joy Bright, a consumer who is based in Magboro, Akeran, Ogun State, expressed her fears over the rising cost of cooking gas in the area from N6,200 per 12.5 kg to N8,500 within a few weeks.
“I was not surprised when the attendant told me the price because I had said in July that the cost will rise further. I had no choice but to buy it, as other alternatives are not options for me. I would not have felt it much if the power supply was regular,” she said.
Another consumer in Lagos, who simply referred to herself as Glory, told Nairametrics that she refilled her 12.5kg cylinder with N7,000 on Thursday. According to her, the rising cost of gas will have a severe impact on the average Nigerian and one of such is the cost of food bought from vendors.
“The cost of food items like rice, beans and even garri has been on the increase for months. This frequent hike in the cost of cooking gas will make matters worse, as several food vendors now use gas for their cooking,” she said.
Read: NLNG set to supply 100% of its cooking gas production to local market
What you should know
- Nairametrics had reported in July 2021, when the National Chairman of Liquefied Petroleum Gas Retailers Branch of NUPENG, Mr Chika Umudu, explained that the price hike was due to the country’s high dependence on the importation of LPG.
- According to him, Nigerian LNG Limited, which accounts for more than 40% of the LPG supply volumes in the country, should be supplying the domestic market in accordance with the demand, rather than having a fixed quantity per annum.
- Energy experts had expressed concerns over Nigeria’s inability to deepen the penetration and utilization of LPG in the country despite theoretically being in a position to produce sufficient LPG to meet local demand.
- Recall that in September 2021, oil marketers under the aegis of Major Oil Marketers Association of Nigeria (MOMAN), protested the Federal Government’s reintroduction of Value Added Tax (VAT) on imported LPG.
- They argued that the introduction of VAT to the already high price of gas which is largely imported due to global gas crisis will negate the government’s policy on the adoption of LPG.
- The association, which are major stakeholders in the downstream sector of the oil industry asked the federal government to rescind its decision by removing the 7.5% VAT on the product, warning that the fee will hamper the adoption of gas in the country and create a barrier to the objectives of the ‘Decade of Gas’ agenda of government.
Bottomline
The incessant hike in the price of cooking gas coupled with the dwindling purchasing power of the average Nigerian does not bode well for the continued adoption of LPG by both rural and urban dwellers, and it is outrightly counterproductive to the government’s widely publicised LPG policy.
Considering that LPG is environment-friendly, convenient, and safe, there is a need for government intervention to make the product more affordable to most Nigerians.