Cooking Gas Becomes Cheaper As Price Drops From N2,200/kg To N1,500 Per Kg

The price of Liquefied Petroleum Gas (LPG), widely known as cooking gas, has dropped by 31.8 per cent from a peak of about N2,200 per kilogramme to N1,500/kg, offering some respite to Nigerian households.

Edu Inyang, President of the Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), in an interview with Daily Sun, attributed the drop to sustained engagements among industry stakeholders, regulators and government agencies aimed at improving supply and stabilising the domestic LPG market.

He said the cut was the result of consultations with key players in the sector to address the factors that were driving up prices.
“The consultations have gone well. “Product availability has improved and confidence has returned to the market which has helped bring prices down,” he said.

The last price was N700 a kilogramme lower than the previous high of N2,200/kg, a drop of 31.8 per cent.

The decision comes after months of anxiety over soaring LPG prices, which have led many households to cut back on usage or turn to alternative cooking fuels.

Inyang was optimistic about the sustainability of the price drop and said that consumers could enjoy further reduction if the current market conditions continue.

We expect the decline to continue. However, prices are influenced by a range of factors including international market conditions, foreign exchange rates and logistics costs. “If they remain favorable, they should continue to benefit from lower prices,” he said.

He said efforts by regulators and industry players to improve supply and clear the bottlenecks in the LPG value chain were beginning to bear fruit.

Speaking on the liberalisation of the LPG market, the NALPGAM president said marketers with the requisite capacity were ready to take advantage of import opportunities to increase supply and deepen competition.

He said that greater private sector involvement in product importation would improve market efficiency and help to moderate prices in the long run.

The reduction in cooking gas prices is expected to alleviate the financial strain on millions of Nigerians grappling with elevated living costs and escalating energy costs.

Recall that the Federal Government on Monday directed regulatory and security agencies to clamp down on the diversion, hoarding and illegal storage of Liquefied Petroleum Gas (LPG) to protect supply and to restore stability to the market in the face of rising cooking gas prices and supply disruptions.

The directive was given in Abuja at an emergency stakeholder engagement convened to develop coordinated solutions to the recent spike in cooking gas prices by the Minister of State Petroleum Resources (Gas), Mr. Ekperikpe Ekpo.

The Minister said the rising cost of LPG was a national issue with serious consequences for households, small businesses and the economy in general.

However, he assured that the Federal Government would continue to work towards easing the burden on Nigerians.

Ekpo ordered the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) to improve market surveillance, create a robust pricing mechanism to guide the market and penalize operators who engage in market-distorting practices.

He also called for collaboration between the NMDPRA and the Department of State Services (DSS), the Economic and Financial Crimes Commission (EFCC) and the Nigeria Police Force to support enforcement efforts, eliminate artificial scarcity and ensure the uninterrupted movement of LPG across the country.

“We have directed the NMDPRA to increase monitoring, engage operators and collaborate with security agencies to discourage hoarding, eliminate artificial scarcity and improve transparency in distribution and pricing,” he said.

Speaking on supply, Ekpo said marketers had indicated their readiness to increase imports, while expected deliveries from new domestic facilities, including the Seplat gas facility, were expected to boost supply in the coming weeks.

The government was also looking at a local blending initiative with the Nigeria LNG Limited, domestic producers and depot owners to improve supply, reduce dependence on imports and support greater price stability, he said.

“There is no reason to panic. “The Government remains committed to ensuring adequate supply of gas locally and to promoting the Decade of Gas Initiative as a route to cleaner cooking, industrial growth and energy security,” he said.

The Chief Executive of the NMDPRA, Mr. Rabiu Umar, also spoke at the meeting, stating that the Authority has commenced an enforcement campaign on pricing and supply-chain practices, warning that operators caught in the act of excessive price increases will face severe sanctions.

“We’re going to be much more aggressive to ensure that no factor is permitted to keep prices at excessively high levels. “We expect to see a big jump in supply and a fall in prices before the end of next month,” Umar said.

The engagement was attended by key senior representatives of gas suppliers, marketers, distributors and consumer groups including the Nigerian Gas Association (NGA), the Major Energy Marketers Association of Nigeria (MEMAN) and the Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), amongst others.