Sunday, April 14, 2024

Cooking gas price rises by 60% in October – Report

Terminal owners increased prices of Liquefied Natural Gas or cooking gas by 60 per cent in the month of October alone.

Market survey carried out revealed that as of the beginning of the month, the price of 20 metric tons of cooking gas at the terminal was N10 million.

However, as of October 20, price had risen to N14 million per 20 metric tons.

A circular on Sunday showed that price had risen to N16 million per 20 metric tons as of Saturday, 21, October 2023; representing a 66 per cent rise in price within the space of one month.

According to the circular issued at exactly at 3:45PM on Saturday by one Allamin Daggash who is the marketing manager at Algasco/NAVGAS, showed that a metric ton of cooking gas was to be sold at N800,000 to gas retailers with immediate effect.

A breakdown of the circular translated that if one metric ton of cooking gas was N800,000, then, it translated to N16 million per 20 metric ton.

Daggash blamed the increase on depreciation in foreign exchange and increase in price at the international market.

“Effective immediately, Ex-Navgas price is N800,000/mt. This is because of the continuous depreciation in FX & increase in international price on product. Payment made after this communication will be recapped at the new price,” the circular stated.

Further findings revealed that; unlike the claim by Daggash that price increment was caused by foreign exchange depreciation and increasing price at the international market; 70 per cent of cooking gas consumed in Nigeria is being supplied by the Nigerian Liquefied Natural Gas Limited.

There are claims that Nigeria had the fastest growing LPG sector in the world with a projected LPG market size of $10bn, as the annual per capita consumption of LPG had risen from 1.8kilogramme in 2015 to 5kg in 2021.

According to the Petroleum Products Pricing Regulatory Agency, domestic consumption of cooking gas exceeded 1 million MT in 2020.

It said the consumption rate made 2020 the first year in the nation’s history when LPG consumption reached the 1 million MT thresholds.

It was also gathered that NLNG currently sells 20MT of cooking gas to marketers for N9m.

Head, Media Relations and Corporate Communication, NLNG, Anne-Marie Palmer-Ikuku, did not respond to enquiry email sent to her on whether or not the company still supplies the market for terminal owners to have blamed hike in prices on FX and international market price.

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