Share!
All efforts by the federal government to tame the skyrocketing prices of Liquefied Petroleum Gas (LPG), otherwise known as cooking gas have failed to impact the rate the product is sold in the open market, with a 5kg cylinder selling for an average of N5,139.25 in January.
The latest data from the National Bureau of Statistics (NBS) showed that on a year-on-year basis, the price Nigerians buy LPG increased by 12 per cent from N4,588.75 in January 2023.
However, the last survey figures released by the NBS may have been obsolete now with the prices further rising substantially in February.
The price of a 5kg cylinder, checks by Economic Confidential showed, now sells for as much as N6,500 or more in several parts of the country, with one kilogramme hitting N1,300 and above in recent times.
In the same vein, a 12.5kg now goes for as high as N16,250, 25kg goes for N32,500 and 50kg sells for N65,000, although there could minor fluctuation in prices, depending on where the product is bought.
In November last year, the federal government announced the exemption of imported LPG and its related equipment from the payment of customs duty and 7.5 per cent Value Added Tax (VAT) to crash the rising prices.
Specifically, in the circular from the ministry of finance, dated November 28, 2023, signed by the head of the ministry, Wale Edun, it said the exemption aligned with President Bola Tinubu’s commitment to increasing the supply of LPG to meet local demand, reducing market prices and promoting clean cooking practice.
But since then, rather than reduce, the prices have gone even higher, putting already financially pressed Nigerians under even more intense pressure.
Also, penultimate week, the Minister of Petroleum Resources (Gas), Mr Ekperikpe Ekpo, said the federal government was considering halting the export of cooking gas, to slow down the escalating prices of the product.
Speaking on the sidelines of an internal gas stakeholders’ workshop in Abuja, the minister said that government was deeply concerned about the increasing rates in the market.
Ekpo stated that serious meetings were ongoing on the matter, including the current practice of selling gas in dollars, which has impacted prices, stating that Nigerians will begin to see changes soon.
“On the issue of LPG, we are interacting with the critical sectors to ensure that there is no exportation of LPG. All LPG produced within the country will have to be domesticated,” he said.
When our correspondent asked why the removal of the 7.5 per cent VAT failed to impact the market, Ekpo said: “It is not going to reflect that way. We are dealing with human beings. We have made a policy. And these people, the investors, they want to maximise the profit that they are going to get from it.
“But at the end of the day, we have to come in. That is why you have the regulator; we are interfacing with them to make sure they crash the price. We are meeting with them on a daily basis”.
However, the latest NBS data on cooking gas prices covering January said the average retail price for refilling a 5kg cylinder of gas increased by 3.55 per cent on a month-on-month basis from N4,962.87 recorded in December 2023 to N5,139.25 in January 2024.
“On a year-on-year basis, this increased by 12 per cent from N4,588.75 in January 2023. On state profile analysis, Nassarawa recorded the highest average price for refilling a 5kg cylinder with N5,790.00, followed by Jigawa with N5,681.82, and Gombe with N5,660.00.
“On the other hand, Kaduna recorded the lowest price with N4,150.00, followed by Ogun and Osun with N4,751.04 and N4,763.53 respectively.
“In addition, analysis by zone showed that the North-east recorded the highest average retail price for refilling a 5kg cylinder with N5,296.32, followed by the North-Central with N5,240.36, while the South-west recorded the lowest with N4,805.05” it noted.
Also, the NBS data showed that the average retail price for refilling a 12.5kg increased by 1.96 per cent on a month-on-month basis from N11,510.16 in December 2023 to N11,735.72 in January 2024. On a year-on -year basis, this rose by 14.19 per cent from N10,277.17 in January 2023.
“On state profile analysis, Cross River recorded the highest average retail price for the refilling of a 12.5kg with N13,040.00, followed by Jigawa with N12,875.00 and Zamfara with N12,725.00.
“Conversely, the lowest average price was recorded in Kaduna with N9,699.50, followed by Kwara and Niger with N10,000.00 and N10,400.00 respectively.
“Analysis by zone showed that the South-south recorded the highest average retail price for refilling a 12.5kg with N12,602.47, followed by the North-west with N12,224.93, while the South-west recorded the lowest price with N11,189.02,” the data showed.
Nigeria has over 208 Trillion Cubic Feet (TCF) of proven gas reserves, about the 9th in the world, but is unable to get it out of the ground due to low investment in the sector, further exacerbated by pricing issues as well as vandalism.
In addition, the country has over 600 Trillion Cubic Feet of potential gas reserves, which could last the country hundreds of years, even if optimally harnessed.
