Cooking gas marketers have warned that if the current crisis in the industry is not handled, the price of 12.5kg of liquefied petroleum gas, which now sells between N7, 500 and N8, 000, might rise N10 000 before December.
As a result of recent price hikes due to a supply deficit, marketers have expressed concern about the item. More Nigerians are turning to alternative fuels like charcoal, firewood, and sawdust because gas prices have risen. These and other energy sources are also becoming more expensive.
Speaking during an e-discussion organized by a renowned Pan-African forum called Platforms Africa, NALPGAM Executive Secretary Bassey Essien revealed this, as reported on Saturday by the organization’s Team Lead Adeola Yusuf, according to Punch.
Aside from the recently announced import levies and VAT, Essien warned that the price of cooking gas in Nigeria might reach N10,000 for a 12.5kg cylinder should the Federal Government not reconsider the measures.
“Today (Saturday), the price has risen to N7, 500 and N8, 000. The skyrocketing price of gas is our fear and what we are trying to avoid. Early in the year a 20-metric ton of gas was selling for below N5m but today, the same tonnage sells for N10.2m. As long as there is that supply shortage, the available quantity and the dynamics of supply-demand will keep pushing the price higher.”
According to Essien, the NALPGAM group is concerned that more Nigerians are being compelled to return to dirty fuels like coal, sawdust, kerosene, and similar substances because “the price of cooking gas has suddenly gone up.”
Even with these difficulties, the NALPGAM Secretary stated, the organization was in contact with the government, stakeholders such as oil companies or energy suppliers, producers, and importers to see how the situation could be improved, as well as persuading marketers not to take advantage of the crisis to increase the cost of gas in their locations while also spending enormous amounts on cooking gas.
While stating that all raw materials utilized by the two-cylinder manufacturing companies in the country were imported and that the cost of cylinders has steadily increased over the years, the NALPGAM secretary expressed concern.
Despite the country’s population of around 180 million people, he said, Nigeria only had up to 10 million cylinders in circulation, many of which were of poor quality.
“The cylinder ownership structure in the country ensures that owners are in charge of their cylinders. Cylinders expire on the 15th year of usage from the manufacturing date. Because of the high replacement cost, consumers buy what they can afford. This has equally encouraged the proliferation of substandard cylinders in circulation. The regulators are working hard to monitor the standard of cylinders coming into the country.
“The progress in cylinder acquisition still needs government input to ensure that the cost of materials for cylinder production get the necessary exemption from duties but however the state of our local currency still remains a major problem.”