The Federal Government (FG) has expressed its commitment to ensuring the further decline of cooking gas prices in the country, as the commodity recently experience a marginal drop in cost.
BizWatch Nigeria understands that as of Thursday, January 6, 2021, the price of 12.5kg Liquefied petroleum gases (LPG) dropped from N8,800 to between N8,400 and N8,200. In some outlets, the price of the commodity dropped to between N7,800 and N8,000.
This drop is significant, as the price of cooking gas jumped by over 240% between January and October last year (2021). During the period, cooking gas moved up from N3,000 for 12.5kg to N10,200.
The Programme Manager, National LPG Expansion Implementation Plan, Office of the Vice President, Dayo Adeshina explained what influenced the cooking gas price drop in the Nigerian market, saying the fact that the country imports the largest percentage of its usage of the commodity and the drop of its price in the global market, made it possible for Nigerians to pay less for it yesterday.
According to Adeshina, the international price of the LPG had risen so high in October last year, but dipped towards the end of 2021 into January 2022.
His words: “If you look at the international pricing of the LPG, and that might change again because it is not a fixed price, in January last year, it was $250 per tonne.
“It rose to $875 per tonne by the end of October and started dropping by the end of November into December, and came down to around $500 per tonne at some point but went up again in December to $708 per tonne.”
He added, “Now, as of the third of January this year, that figure is $744 per tonne. So you can see there is a drop from about $800 around November to $700 in January. The issue here is that the price has been fluctuating.
“Yes you have the effects of Customs and the position of the VAT that made people pay tax for what they imported even in 2019 and 2020. Of course, some importers stopped importing, but there is a resolution going on to resolve that aspect.”
Expressing his delight at the development, Adesina said, “It is in government’s interest for the price to go down consistently and there are certain initiatives that are being taken at the moment, which hopefully will see to further drops in price regardless of the international cost.”
When asked to state one of such initiatives, he replied, “The discussions are still ongoing and there are certain things that you can do to stimulate the market which will have an effect. One of them also has to do with storage.”