5 months ago
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- Cooking gas dealers have hiked the commodity’s prices again despite an existing tax waiver on the product
- Findings show that the cooking gas price increased slightly by N100 per kilogramme after crashing a few weeks ago
- Dealers blame the rise in the price of the product on import constraints and foreign exchange volatility
Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
Despite repeated attempts by the Nigerian government to crash cooking gas prices, dealers have reported a hike in the cost of the commodity, citing foreign exchange challenges as the reason.
Checks by Legit.ng show that the commodity's price has risen slightly to N1,066 per kilogramme.
Marketers report rise in cooking gas prices despite FG's tax waiver
Credit: NovartisSource: Getty Images
Dealers disclose reason for price hike
The dealers say the addition is due to the crash of the naira against the US dollar.
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Two weeks ago, a kilogramme of cooking gas sold for N900, which the dealers attributed to availability and stable naira.
According to reports, the price of a 12kg cooking gas fell from N13,800 to N13,000 compared to May 2024, when the commodity sold for about N15,000 per kilogramme.
However, dealers hiked the price of cooking gas, with a 6kg refill selling for N6,400 from the N5,400 it sold early in June.
A manager at a leading gas company, Gasland, who pleaded anonymity, said the company increased the commodity’s price due to exchange rate challenges and a slight scarcity.
He disclosed that most of the liquified natural gas used in Nigeria is refined abroad and imported into the country.
He said that despite Nigeria's efforts to reduce the product’s cost, such as tax waivers, cooking gas prices have remained volatile due to low local output.
“As Nigeria continues to import 50% of its LPG needs, the prices will remain volatile and high.“Importers complain mainly about the high cost of forex, which is also a primary determinant of the pricing of the commodity. If there is enough forex at cheaper rates, there is no reason the price will not crash.“Also, most Nigerians are embracing cooking gas, leading to a surge in the commodity’s cost as demand drives price.”FG waives VAT on LPG
A previous report by Legit.ng showed that dealers of liquified petroleum gas (LPG), also known as cooking gas, crashed the commodity's price following supply improvements.
According to a market survey conducted by Legit.ng, the dealers have crashed the product's price to N900 per kilogramme from the N1,300 it sold weeks ago.
The dealers reported improvements in supplies from various depots, saying that the price also crashed due to the relative availability of foreign exchange for import.
FG signs deal to crash cooking gas prices
About a week ago, NLNG Shipping and Marine Services Limited (NSML) and Temile Development Company Limited, a Nigerian company, signed a vessel management agreement for the management of the shipping vessel LPG Alfred Temile 10.
Temile Development Company Limited owns the 23,000 cubic meter LPG Alfred Temile 10, and NSML is the official technical vessel manager.
Abdulkadir Ahmed, the managing director of NSML, attended an event in Abuja to finalise the deal. He called it a significant milestone and stated that it would increase the supply of LPG or cooking gas throughout the subregion.
The cost of cooking gas increases again
Legit.ng reported that the National Bureau of Statistics has revealed that the average price for refiling a 5kg Liquefied Petroleum Gas (Cooking Gas) cylinder in Nigeria stood at N6,591.62 in March 2024.
This represents a 7.10% increase compared to the N4,562.51 average price recorded in February 2024, which was N6,154.50,.
While on a year-on-year basis, cooking gas prices increased by 42.97% from N4,610.48 paid in March 2023.
Source: Legit.ng
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