Dealers Frown As Cooking Gas Price Rises By 29% In Two Months

Dealers in Liquefied Petroleum Gas (LPG), popularly known as cooking gas, have decried the 29 per cent price increase of 20 metric tonnes of the product in the country over the past two months.
You would recall that in December 2020, terminal operators and importers increased the price of 20 metric tonnes of LPG to N5.3m from an average of N4.4m, prompting retailers to refill a 12.5kg cylinder at between N4,000 and N4,500.
The station manager, Sun Gas Limited, in Port Harcourt, Mr Toby Aigbe, noted in an interview with The Tide that the price of the product increased further in January, as 20 MT was sold for as high as N5.5m last Tuesday, translating to an increase of 29.41 per cent.
Aigbe attributed the continuous price increase of cooking gas in recent months to the depreciation of the naira against the dollar, adding that increased global demand pushed up the cost of importing the product into the country amid inadequate local supply.
In a related development, LPG, an advocacy organisation championing the use of LPG in the country, stated in a new report that LPG sourcing in 2020 was dominated by imports, taking over 50 per cent of the market with local sources accounting for 46 per cent.
It said local supply was mainly by NLNG Bonny at 41 per cent (361,163 MT for NLNG and 515,586 MT for other sources), while the other five per cent was from Mobil BRT, Bonny.
It noted that there were new players, including Techno Oil and Rainoil with 8400MT and 8000MT capacity respectively in depot storage.
The report said, “The addition of depots helped the industry achieve the highest monthly LPG volumes yet, of 100,000MT in September 2020.
“However, little traction was made by these new entrants as they were not able to receive from NLNG.”
According to the report, NIPCO Plc once again dominated the LPG depot space, taking 34 per cent of the market, while Matrix Energy came a distant second position at 16 per cent.
It said, “Other players that did well are NAVGAS and Stockgap Fuels, which just started receiving from NLNG in September and has consistently grown their volumes with the partnership.
“The market in 2021 is projected to be in the range of 1.3 million MT for butane. We are looking at the progress of the propane market powered by autogas and hope it makes a significant addition to the market performance.”

By: Tonye Nria-Dappa