Liquefied Petroleum Gas Retailers (LPGAR) urged the Nigerian Government to develop and establish more local LPG production plants, NLNG price domestication, storage and transportation to prevent further price hikes.
This was disclosed by Mr Ayobami Olarinoye, the Branch National Chairman of LPGAR, made in an interview in Lagos on Friday over the looming price hike on cooking gas.
He stated that retailers have been bearing the burden despite the price rising over the last weeks.
Retail prices
Olarinoye noted that during this period of the year, international prices of LPG usually rise, adding:
- “This is why the rise has not been substantially reflected in the retail prices.
- “The recent price increase, as well as the expected further price increases, is as the result of further depreciation of the Naira in recent time,”
- “Again, during this period of the year, international prices of LPG usually rise. This is the second major factor leading to the increases in the price.
Nigerian market
They added that Nigeria’s main supplier, the NLNG supplies the market with international prices, citing exchange rate differences too, they said:
- “The Nigerian LPG market is often priced according to the international market because of the country’s dependent on importation for a substantial amount of LPG she consumes.
- “Again, the country’s major supplier, the Nigeria Liquefied Natural Gas (NLNG), supplies local marketers, using the international LPG price and US dollar rate.
- “So, it is obvious that the price rise is a result of recent changes in the exchange rate and the global market price,”
The association noted that NLNG had been doing its best but advised that other major operators in the industry could establish LPG production plants and make it available to the local market, urging the FG could have an arrangement with NLNG and other possible producers to domesticate the pricing of the product, then it would make the product affordable to the consumers.
- “Indeed the time is very critical. The price of PMS has risen beyond the purchasing power of the average person.
- “Even the price of diesel has started to rise. Again, prices of essential commodities, especially food have skyrocketed.
- “It is really a difficult time for the people of this country. As I said earlier, if the government can work closely with NLNG and LPG importers and provide them with some incentives, then the price can be affordable to Nigerians at this critical time,”.
They called on NLNG to domesticate its LPG pricing system and increase its local supply.
What you should know
Recall Nairametrics reported that the Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGM), Olatunbosun Oladapo, revealed that Nigerians will pay higher costs for cooking gas from mid-August 2023.
Oladapo said that gas consumers in the country should prepare for an increase in the price of liquefied petroleum gas (cooking gas).
Reasons for the expected price increase
According to the NALPGM President, cooking gas prices in Nigeria will experience a hike because of rising international prices, high tax rates, high prices of vessels, forex scarcity, and naira devaluation. Oladapo said:
- “It is starting next week because international prices have gone up. The prices of vessels have gone up and taxes are high, but consumers are not earning more. Their purchasing power has gone down.
- “Everybody is crying. Consumers, middlemen, and retailers are feeling the impact because business is now on the low side. The situation is very unfortunate because prices are going higher. Nigerian consumers are passing through very difficult times because they can no longer afford gas
- “Local taxes are worsening the problem. The government should come in and alleviate the suffering of the masses by providing palliatives and reducing taxes and levies.”
It is part of the curses afflicting the country. God gave us gas in abundance yet we pay heavily to.deploy.for our benefits..Must it be only NLNG to produce domestic gas and hold us to ransom and yet could not provide road in Bonny island