Forex volatility pushes cooking gas price up by 70%

The volatile foreign exchange rate and Nigeria’s high dependence on the importation of Liquefied Petroleum Gas (LPG) also known as cooking gas is reportedly responsible for the spike in the price in over 12 months.

Despite the government efforts in recent times to bring down the price of cooking gas by granting a VAT waiver on the product, the price has continued to accelerate, rising by 70.12 percent in the last one year.

Nigeria imports over 50 per cent of her cooking gas as local production is insufficient to meet local demand thus making the price susceptible to forex fluctuations.

The National Bureau of Statistics (NBS) in its Liquefied Petroleum Gas (Cooking Gas) Price Watch for May 2024, reports that the average retail price for refilling a 5kg Cylinder of Liquefied Petroleum Gas increased from N4,360.69 in May 2023 to N7,418.45 in May 2024, an increase of 70.12 per cent on a year-on-year basis.

On a month-on-month basis, it increased by 13.75 per cent from N6,521.58 recorded in April 2024 to N7,418.45 in May.

The NBS report also shows that the average retail price for refilling a 12.5kg Cylinder of Liquefied Petroleum Gas declined by 0.07 per cent on a month-on-month basis from N15,637.74 in April 2024 to N15,627.40 in May 2024. But on a year-on-year basis, this rose by 63.85 per cent from N9,537.89 in May 2023.

Benue recorded the highest average price for refilling a 5kg Cylinder of Cooking Gas with N8,012.03, followed by Enugu with N7,926.21, and Ondo with N7,857.53. On the other hand, Yobe recorded the lowest price with N5,842.31, followed by Jigawa and Katsina with N6,521.81 and N6,567.95 respectively.

In a related development, the NBS also reported that the average retail price per litre of Household Kerosene (HHK) in May 2024 was N1,450.35, showing an increase of 0.74 per cent compared to N1,439.64 recorded in April 2024. On a year-on-year basis, the average retail price per litre of the product rose by 20.26 per cent from N1,206.05 in May 2023.

On state profile analysis, the highest average price per litre in May 2024 was again recorded in Benue with N1,790.92, followed by Kaduna with N1,769.65 and Cross River with N1,722.94. On the other hand, the lowest price was recorded in Katsina with N1,230.81, followed by Kwara with N1,260.07 and Jigawa with N1,263.91.

In addition, analysis by zone showed that the North Central recorded the highest average retail price per litre of Household Kerosene with N1,534.12, followed by the South-West with N1,488.97, while the North-East recorded the lowest with N1,408.41.