Liquified petroleum gas, or cooking gas, saw a price collapse in June, but it has since rebounded. Research indicates that the current cost to refill a 12.5-kilogramme cylinder is approximately N14,500, N7,200 for 6 kg, and N1,200 for 1 kg.
Cooking gas witnessed new prices as a 12.5 kg refill sold for N13,200, a 6 kg refill for N6,600, and a 1 kg refill for N1,100 in June caused the commodity’s price to plummet. Consistent with foreign currency stability, the commodity’s price held steady in May.
Gas merchants that deal in cooking gas said that the price increase was due to unstable foreign exchange, forcing most of them to depend on imported goods instead of Nigerian NLG Limited supplies.
Citing Legit.ng, a dealer, speaking to the brand anonymously, stated that the high FX rate and volatility are to blame for the price increase.
He said: “There is always a pattern with our sales. Each time the FX market is stable in the Forex market, the prices remain stable and affordable. The market reacts to fluctuations in the Forex! market.”
According to reports following how FX affects LPG prices, the dealers disclosed their intentions to keep the product’s rate steady, but expensive FX has continued to be a barrier.
Continuing, the dealers claim that every time there is a rise, consumers migrate to other energy sources like charcoal and electric stoves, which causes a sharp decline in their sales.
An alarm has been raised by marketers over incessant hikes in the price of gas. Oladapo Olatubosun, the President of the Nigerian Association of Liquified Petroleum Gas Martkers (NALPM), issued a warning on the national news brand, stating that cooking gas prices would only rise further due to the ongoing impact of the exchange rate.
According to him: “It Is expected that when the foreign exchange increases, the price of LPG will follow suit because it is still priced and determined by the flow of forex.”
It is believed by analysts that the actions of the Nigerian government, which include giving out a million petrol cylinders for free and eliminating import taxes and VAT on LPG imports, have not had a good impact on costs. Additionally, the price is subject to inflationary tendencies, which increased to 34.19% in June according to the National Bureau of Statistics.
Following the data that shows states with the highest cooking gas prices, refilling a 5 kg cylinder of Cooking Gas (Liquefied Petroleum Gas) in Nigeria costs, on average, N6,591.62 as of March 2024, according to data from the National Bureau of Statistics, which was originally published by the national news brand.
However, in comparison to the N4,562.51 average price that was noted in February 2024, which was N6,154.50, this indicates a 7.10% increase. The price of cooking gas climbed by 42.97% year over year from N4,610.48, which was paid in March 2023.
