Consumers in Nigeria are grappling with soaring prices of liquefied natural gas (cooking gas) as terminal owners have unilaterally increased prices by 60% within one month.
This sharp rise in prices has sparked concerns among both consumers and industry experts, who are now questioning the reasons behind the dramatic price hike.
A market survey conducted revealed that at the beginning of October, the cost of 20 metric tons of cooking gas at the terminal was set at N10 million but by October 20 that price had surged to N14 million for the same quantity.
Shockingly, the price had further escalated to N16 million per 20 metric tons by October 21, 2023.
The circular, issued on October 21 by Allamin Daggash, identified as the marketing manager at Algasco/NAVGAS, clarified that a metric ton of cooking gas was to be sold at N800,000 to gas retailers.
A simple calculation revealed that this amounted to N16 million for 20 metric tons.
The circular cited depreciation in foreign exchange and an increase in international market prices as the reasons behind the steep price increase.
However, further investigations revealed that despite their claims, a substantial portion of cooking gas consumed in Nigeria is supplied by the Nigerian Liquefied Natural Gas Limited (NLNG).
NLNG currently sells 20 metric tons of cooking gas to marketers for N9 million and industry insiders suggest that NLNG continues to supply the market, undermining the terminal owners’ reasoning.
The situation has led to growing concerns, particularly given the rapid increase in the retail price of cooking gas, reaching as high as N1,200 per kilogram.
Consumers and industry experts are apprehensive about the plight of ordinary Nigerians and the potential negative impact on the country’s economic landscape.
The price hikes have been attributed to terminal owners who are accused of prioritizing quick profits over the well-being of consumers, potentially exploiting the situation for their financial gain.
The NLNG’s role in the supply chain also raises questions about whether they are adequately meeting the market’s needs or if there are supply issues driving the price increases.