Cooking Gas Price Drops By 16% — Survey

LPG Cooking Gas Cylinders

Price of cooking gas has dropped by 16% in the domestic market as a result of improved supply and distribution.

Vanguard report continues:

A market survey by Vanguard in Lagos and its environs showed that the price of 12.5kg which hit the roof at ₦4,500 in May, has dropped to ₦3,800.

While the price of 25kg that stood at ₦9,000 in May, this year also dropped to ₦7,600. Other sizes also showed significant drops in prices

Mr. Femi Olawore, Executive Secretary of the Major Oil Marketers Association of Nigeria (MOMAN) disclosed that there were commercial stocks of the product in the market.

“Unlike in the past, the supply and distribution of cooking gas have improved in the domestic market, thus resulting in stability. Despite increase in demand, there would not likely be shortage and high prices in at least short term,” he added.

The National Bureau of Statistics (NBS) indicated in its May 2017 report that the average price for the refilling of a 5kg cylinder, increased by 0.75% month-on-month and 31.96% year-on-year to ₦2,446.57 in May 2017 from ₦2,424.38 in April 2017.

Highest average price

It stated that states with the highest average price for the refilling of a 5kg cylinder for cooking gas were Gombe (₦2,600), Akwa Ibom (₦2,590) and Rivers (₦2,585.00).

The report has it that states with the lowest average price for the refilling of a 5kg cylinder for cooking gas were Kaduna, Kano, Katsina, Ogun and Sokoto (₦2,300), Ondo (₦2,294.44) and Osun (₦2,268.75).

According to the report, “similarly, average price for the refilling of a 12.5kg cylinder for cooking gas increased by 2.64 per cent month-on-month and by 33.11% year-on-year to ₦4,957.88 in May 2017 from ₦4,830.22 in April 2017.

“States with the highest average price for the refilling of a 12.5kg cylinder for cooking gas were Kebbi (₦5,375), Cross River (₦5,330) and Borno (₦5,300).

“States with the lowest average price for the refilling of a 12.5kg cylinder were Lagos (₦4,621), Oyo (₦4,615) and Katsina (₦4,600).”

It also identified Kaduna, Kano, Katsina and Ogun as states with ₦2,300 as the lowest price of cooking gas during the period.

Other states with the lowest price, according to the report, included Ondo and Osun with ₦2, 294.44 and ₦2, 268.75 respectively.

NLNG and LPG supply: The Nigerian LNG Limited stated that the domestic LPG price is based on an international price index plus 50% of the shipping cost of delivering the product to receiving facilities in Apapa-Lagos.

It indicated that the price is invoiced in naira at the prevailing official interbank exchange rates, contrary to erroneous assertions made in parts of the media.

It stated: “The reality of this is that although LPG is produced and consumed locally, the product, like crude oil, is an internationally traded commodity with an international price benchmark, open to global demand and supply pressures.

“NLNG commenced the supply of Liquefied Petroleum Gas (LPG), otherwise known as cooking gas, to the domestic market in 2007 when refineries became challenged and supply was grossly inadequate. Since then, the issue of inadequate supply has become a thing of the past.

“The intervention, which is in line with the company’s vision of helping to build a better Nigeria, has significantly contributed to the stimulation and development of the domestic LPG market in Nigeria and has effectively brought down the price of cooking gas from over ₦7,000 in 2007 to less than ₦3,500 per 12.5kg cylinder today.

“NLNG is committed to delivering 250,000 tonnes of LPG into the Nigerian market annually and has signed Sales and Purchase Agreements (SPAs) with 15 off-takers (all Nigerian companies) for the lifting of LPG for the domestic market,” it added.