The yuletide season is characterized by two pivotal activities: food preparation and travel. Traditionally, various local and international dishes are cooked, creating a delightful culinary experience.
Additionally, this period witnesses extensive travel as individuals journey significant distances to be with their loved ones.
The feasibility of both these activities is contingent on the costs of fuel (PMS) for transportation and cooking gas (LPG) for culinary purposes.
Recent developments in the petroleum industry suggest that Nigerians will experience a historic surge in fuel prices this Christmas. The deregulation of the downstream sector in June led to a notable escalation in fuel (PMS) prices.
According to the NBS in its latest PMS price watch, the average retail price of PMS increased by 220.49% from November 2022 to November 2023.
A survey of some petrol stations in Lagos reveals that the price of 1 litre of fuel (PMS) ranges between N600 and N650- a record in the nation’s history.
This has effectively made transport as expensive as ever. The latest NBS transport fare watch reveals that on a year-on-year basis, the cost of transport increased by 61.27% on inter-city bus journeys between November 2022 and November 2023.
Looking back at the cost of PMS in the past few Decembers, one would realise that Nigerians are in for the most expensive Christmas in a while. In December 2022, the average price Nigerians paid for petrol was N206.19k per litre according to the NBS. This represents a 315.2% increase when compared to the average retail price of N650 today.
If we delve further into December 2021, the average retail price of PMS according to the NBS was N165.77k. This means that over two years, Nigerians paid around 392.10% more on petrol during the yuletide.
The removal of fuel subsidy by President Bola Tinubu on his inauguration is mainly responsible for this increase
It is in this wise the federal government decided to introduce a 50% discount for major inter-state travel routes during the Yuletide and free train rides. Although details of the plan show cracks in terms of the population to be covered and the seamless logistics of moving a significant section of travellers.
Cooking gas prices
Although Nigerians will spend more on cooking gas this Christmas compared to last December, the difference will not be as stark as that of PMS.
Checks by Nairametrics reveal that the price of 1kg cooking gas (LPG) hovers between N950 and N1,100 in cooking gas stations across Lagos. The latest cooking gas (LPG) price watch from the NBS reveals that the average cost of 5kg of cooking gas is N4,562.51. This translates to an average of N912.50k per Kg of LPG nationwide for November 2023.
A review of the price of cooking gas from 2021 reveals that there has been a 153.2% increase in the price of cooking gas from December 2021 to December 2023. According to the NBS, the average price of cooking gas in December 2021 was N3594.81k for 5kg. This translates to around N718 per kilogram.
Why the cost of cooking gas is increasing
A report by Nairametrics reveals that the rise in the price of LPG is because of the following; high demand, low local production, the naira-dollar exchange rate, and geopolitical events like the Russia-Ukraine war.
The Chief Executive Officer (CEO) of the NLNG Dr. Philip Mshelbila in August acknowledged that Nigeria can only meet 40% of the total LPG demand with the remaining 60% being imported.
Also, the unification of the exchange rate market in June led to the naira losing over 50% of its value on the NAFEM thus negatively impacting the cost of cooking gas for the end user.
The inevitable reality
In the end, whether you’re travelling or not for the Yuletide, you’ll have to eat and with the state electricity supply across the country, you might need to power your generator for some comfort. This means that you cannot escape the most expensive Christmas as a Nigerian.
