Federal Government’s Bid to Lower Cooking Gas Prices Stalls: Households, SMEs Continue to Pay Above N1,100/Kg

One month after the federal government’s commitment to reducing the cost of Liquefied Petroleum Gas (LPG), commonly known as cooking gas, households and small businesses are still grappling with high prices, surpassing N1,100 per kilogram.

Recall that on November 26, 2023, Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, pledged to address the rising gas prices, citing concerns over its affordability for citizens. Despite interventions, investigations by Daily Trust reveal that the prices have not significantly decreased.

The initial spike, with prices exceeding N1,200 per kg in some states last November, was attributed to challenges in sourcing forex for imports and insufficient domestic supply, as stated by Ekpo’s spokesman, Louis Ibah.

A committee, led by the CEO of the Nigerian Midstream Downstream Petroleum Regulatory Authority (NMDPRA), was formed to provide recommendations on boosting supplies and reducing LPG prices. The government also granted VAT and import duty waivers to gas producers in an effort to alleviate costs.

Despite these measures, a 12kg cooking gas cylinder still commands a price between N11,000 and N12,500 in various parts of Nigeria. This has led to concerns, especially among middle-income households and small and medium-scale enterprises (SMEs), relying heavily on cooking gas for daily operations.

The shift towards gas usage increased following the removal of fuel subsidy on May 29, 2023. However, the subsequent rise in gas prices has left many feeling the financial strain, with some resorting to alternative energy sources like charcoal and firewood.

Experts argue that Nigeria, rich in gas reserves, has not fully tapped into this potential. Despite the country’s commitment to leveraging gas for domestic and industrial purposes, challenges persist, affecting citizens’ access and affordability.

In the face of global efforts to address climate change, the rising cost of cooking gas has led to increased deforestation as more turn to wood as an alternative. This contradicts Nigeria’s commitment to environmental sustainability, as demonstrated by signing pacts and initiatives like COP26 and the Climate Change Act.

Gas dealers in various regions are selling at varying prices, ranging from N926 to N1,200 per kg, further complicating the situation. Supply disruptions have been reported, contributing to the high demand and subsequent price surge.

While the government claims to have provided palliatives and incentives, stakeholders emphasize the need for sustained efforts, including addressing vandalism affecting gas production and ensuring stability in crude oil, a key factor in gas production and sufficiency. Despite President Tinubu’s intervention, the road to affordable cooking gas remains challenging, leaving many households and SMEs in a difficult position.