Aviation fuel, cooking gas prices crash

Aviation fuel, cooking gas prices crash 

Price of aviation fuel otherwise called Jet A1 has dropped from about N800 per litre to an average of N650 in Nigeria.

Similarly, cooking gas has recorded a downward slide in price from N9,500 for 12.5kg to N6,500.

The downward trend in prices of the two petroleum products, according to a new report by Daily Trust, is coming after the Federal Government announced the removal of petrol subsidy.

Ironically, while the subsidy removal has caused the rise in petrol price from N187 per litre to about N500, aviation fuel and cooking gas are witnessing a reduction in prices.

Daily Trust checks indicated that Jet A1 was sold at N620 in Lagos; N660 in Abuja and N680 in Kano.

“The price is crashing and I think we can’t explain the trend but I want to believe it is the forces of demand and supply that are at play.

“This has been the development since last week when fuel subsidy was removed from Jet A1. It appears this is a spontaneous reaction to developments in the oil and gas market,” said an operator.

Daily Trust reports that the price of Jet A1 skyrocketed beyond what the operators expected, hitting almost N1,000 per litre last year.

One of the operators who spoke with our correspondent said the reduction in price of Jet A1 is a respite to airlines.

This is the situation with cooking gas with 12.5 kg crashing from about N14,000 to N6,950 in Lagos and about N8,000 in other states as at yesterday.

Checks at different locations yesterday indicated that the cooking gas was being sold at about N700 per kg as against over N1,000 a few weeks ago.
Energy expert, Olusesan Okunade, said, “I think it is just the forces of demand and supply that are working on the gas which we talked about in terms of liberalisation. I am sure because there is no fund in circulation, people are not buying so much. So there is supply, rather than wasting the resources, you will rather dispose at a very minimal margin. There is no gimmick for what is happening. I learned as of today (yesterday), it is about N6,950. It has no correlation with fuel subsidy.
“To the best of my knowledge, I have not heard anything being responsible for this. People just want to dispose of those things, and sell at a minimal margin as against when we were buying it N12,000; N13,000.
“For Jet A1, the demand is on the high side, people are still traveling. It is a specialized fuel for airlines. I have not heard anything special that they have done but I don’t think it is in correlation with removal of fuel subsidy.”