Why consumers are experiencing hike in cooking gas price – Marketers explain

Date:

Lagos, April 21 2023 The Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM) has attributed hike in the price of cooking gas to fluctuations in exchange rate, multiple taxes, scarcity of foreign exchange, among others.

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Mr Bassey Essein, Executive Secretary, NALPGAM, said this in an interview with Naija247news on Sunday in Lagos.

Essein also said that another issue was the inability of marketers to frequently import Liquified Natural Gas (LPG), known as cooking gas, to boost the domestic supply.

He said that although the price of cooking gas was still high, when compared to the price sold last year, but had remained stable since the beginning of the year.

Essien said, “The source of LPG for sometime now has been predominantly from the Nigeria LNG and has never met the demands.

“This is because of the supply- demand gap and market dynamics. All these work in concert to affect the price. Hence, the price goes up.

“The inability to import LPG as frequently as before and to argument the inadequate domestic supply is due to fx, exchange rate and taxes are major factors.”

He called for more investment in gas processing sector in the country and urged the Federal Government to grant investors the necessary incentives that would encourage such.

“Remove taxes and tariffs on gas. Grant other incentives that attract investors.

“The penalty for gas flaring l learnt has been increased. Maybe it will work because if a company recognises the penalties paid on these, it might encourage the worthwhile investment in gas processing, he added.

Also, Mr Oladapo Olatunbosun, NALPGAM President, said that government could put in place incentives to encourage exploration.

Olatunbosun said that foreign and local investors could be encouraged to explore and invest more in gas business.

According to him, it is necessary because Nigeria has abundant supply in the soil and under water.

Olatunbosun said that nation had the required storage facilities, but needed to do more on exploration.

He said, “The price is coming down gradually. The only solution to bring price down significantly is to improve on supply.

“Mark you, inflation affects all pricing. We should also know that value of our currency is a factor.

“Why price is a major issue is because the purchasing power of the masses is low.

“As a country, we should plan for increasing in the local supply through exploration.

“We need more of big plants like NigeriaNLG to boost supply, then the price would come down.”

However, Naija247news correspondent who monitored some of the cooking gas retailers in Epe, gathered that prices of coking gas were relatively stable since October 2022.

A gas operator at Enyo LPG Station in Epe, who preferred anonymity, said that refilling of 12.5 kg cylinder costs N9,400.

He said the price had been stable for months compared to early 2022 where it was sold between N10,500 to N12,000 for 12.5kg.

Another retailer in Epe, Mrs Funmi Omole, said that the price of 12kg cylinder of cooking gas was between N7,200 to N8,900 per 12.5kg around Feb. 2022.

According to her, the same commodity has increased to N9,400 within a few months.

She said, “It is becoming unbearable to survive in Nigeria, as the cost of every essential commodity has been on the rise since last year.

“There is no assurance that it will end anytime soon.”

Another consumer in Lagos, who simply referred to herself as Madam Glory, said that she refilled her 12.5kg cylinder with N9,550 on April 11, in Somolu.

According to her, the rising cost of gas will have a severe impact on the average Nigerian, particularly increase in the cost of food from vendors.

She said, “The cost of food items like rice, beans and even garri have been on the increase for months.

“This frequent hike in the cost of cooking gas will make matter worse. Several food vendors now use gas for their cooking,” she said.

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