Nigerian airline operators have issued a notice that with effect from today, they would shut down their operations due to the high cost of aviation fuel which has hit N700 per litre.
A statement by the President of the group, Allen Onyema, made available to The Tide in Port Harcourt, stated that operators have carried on deploying and subsidising their services to passengers in the last four months despite the steady and astronomical hike in the price of JetA1 and other operating costs.
According to him, overtime, aviation fuel price (JetA1) has risen from N190 per litre to N700 currently.
He maintained that no airline in the world can absorb this kind of sudden shock from such an astronomical rise over a short period.
The airlines – Azman Air, Max Air, United Nigeria Airways, Ibom Air, Arik Air, Air Peace, Dana Air and Overland Airways – made this known in a letter addressed to the Minister of Aviation, Senator Hadi Sirika while copying the Director General of the Nigerian Civil Aviation Authority, Captain Musa Nuhu.
While aviation fuel worldwide is said to cost about 40percent of an airline’s operating cost globally, the present hike has shut up Nigeria’s operating cost to about 95percent.
In the face of this, airlines have engaged the Federal Government, the National Assembly, NNPC and oil marketers with the view to bringing the cost of JetA1 down which has currently made the unit cost per seat for a one hour flight in Nigeria today to an average of N120,000.
The latter cannot be fully passed to passengers who are already experiencing a lot of difficulties.
A statement advised the travelling public who intend to fly to make alternative arrangements to avoid being stranded at the country’s airports.
The statement read: “It is with a great sense of responsibility and patriotism that the Airline Operators of Nigeria (AON) have carried on deploying and subsidising their services to our highly esteemed Nigerian flying public in the last four months despite the steady and astronomical hike in the price of JetA1 and other operating costs.
“Overtime, aviation fuel price (JetA1) has risen from N190 per litre to N700 currently. No airline in the world can absorb this kind of sudden shock from such an astronomical rise over a short period. While aviation fuel worldwide is said to cost about 40percent of an airline’s operating cost globally, the present hike has shut up Nigeria’s operating cost to about 95percent.
“In the face of this, airlines have engaged the Federal Government, the National Assembly, NNPC and oil marketers with the view to bringing the cost of JetA1 down which has currently made the unit cost per seat for a one hour flight in Nigeria, today, to an average of N120,000. The latter cannot be fully passed to passengers who are already experiencing a lot of difficulties.
“While AON appreciates the efforts of the current government under the leadership of President Muhammadu Buhari to ensure air transport in Nigeria grows, unfortunately, the cost of aviation fuel has continued to rise unabated thereby creating huge pressure on the sustainability of operations and financial viability of the airlines. This is unsustainable and the airlines can no longer absorb the pressure.
“To this end therefore, the Airline Operators of Nigeria (AON) hereby wishes to regrettably inform the general public that member airlines will discontinue operations nationwide with effect from Monday, May 9, 2022 until further notice.
“AON uses this medium to humbly state that we regret any inconveniences this very difficult decision might cause and appeal to travellers to kindly reconsider their travel itinerary and make alternative arrangements”, President, AON, Alhaji Abdulmunaf Yunusa Sarina, advised.
However, Ibom Air has said that it is not part of the decision of Airline Operators of Nigeria (AON) to suspend flight operations from tomorrow over increase in aviation fuel price to N700.
The airline said even though it acknowledged the existential threat that fuel price increases pose for the air transport industry in Nigeria, it could not afford to stop operating given its obligations to suppliers, financiers and staff, which depend on uninterrupted flow of revenue to service.
It said every airline has its unique business model and pressures and that despite the escalating fuel prices, airlines volunteering to stop operations would rather exacerbate an already bad situation.
“Ibom Air acknowledges the existential threat that these runaway fuel price increases pose for the air transport industry in Nigeria. We agree that this out-of-control situation is simply unsustainable.
“However, every airline has its unique business model and pressures. We believe that in spite of the escalating fuel prices, airlines volunteering to stop operations would rather exacerbate an already bad situation.
“Ibom Air has financial obligations to suppliers, financiers and staff, which depend on uninterrupted flow of revenue to service. More importantly is the fact that having been paid by customers in advance for flight bookings we are bound by contract to deliver the services already paid for, to avoid exposing the airline to the risk of avoidable litigation.
“Apart from the above factors, Ibom Air is currently the only airline serving Akwa Ibom State directly and as such, any voluntary stoppage of operations would completely cut off access by air into and out of the state. Such action would be directly in conflict with and detrimental to the interest of our shareholder.
“In view of the foregoing facts, Ibom Air had respectfully disagreed with the decision of AON to suspend flight operations on Monday, May 9, 2022. Ibom Air cannot in the circumstance volunteer to stop operating and will continue normal operations on Monday, May 9, 2022, and beyond.
“Ibom Air’s inclusion as ‘signatory’ to the statement released by AON must have derived from its active and committed membership of the AON.
“The above notwithstanding, we identify very strongly with our AON colleagues and will participate in every effort to resolve this frightening situation as soon as possible in the interest of our business, our customers, our stakeholders and our country,” the airline said.
Meanwhile, the Minister of Aviation, Senator Hadi Sirika, yesterday, said the planned shutdown of airline operations by Airline Operators of Nigeria (AON) wasn’t in any way a strike against the Federal Government.
The ministry reacted to inquiries by some media houses to clarify if the notice to the Federal Government and passengers by the Airline Operators of Nigeria to shut down airline operations from Monday, 9th was a strike over the rising cost of Jet-A1.
In a statement by the Special Assistant to the Minister of Aviation, Dr James Odaudu, he said operations of airlines were purely their private business and not connected to being a strike.
His statement read: “Since members of the Airline Operators of Nigeria (AON) issued a notice of withdrawal of flight services as a result of the rising cost of Jet A1 (Aviation fuel), and in spite of the initial statement by the ministry, enquiries have continued to flood in with some under the erroneous impression that the withdrawal was a kind of strike against the government.
“We wish to state that the decision of the association is purely a business one as they are private businesses reacting to market forces but appealing for interventions to enable them to carry on with their operations.
“The ministry has always made conscious efforts to assist members of the Airline Operators of Nigeria (AON), some of which includes facilitating a meeting between the Association and Mr President, during which the Association got several concessions, including duty-free importation of aircraft, engines, spare parts and components.
“The Honourable Minister at various times personally took members of the association to engage with Central Bank of Nigeria (CBN) to sort out issues of access to Foreign Exchange (FOREX) for their operations, and also the NNPC to exploit ways of ensuring the availability of Aviation fuel (JET A1) through importation or from the major marketers.
“It should also be recalled that members of the association were also considered for, and given Bail-out funds to the tune of N4billion during the COVID-19 pandemic to ensure that they remained afloat. This was without prejudice to the fact that most of them were heavily indebted to aviation agencies (as they still are).
“We believe that members of the association are patriots who have continued to bear the brunt of an unfavourable oil market for which we salute their doggedness.
“It is gratifying that members of the association have started reviewing the decision to withdraw flight services, with Ibom Air Green Africa Airlines, Arik Air, Dana and others confirming that they will carry on with their normal flight schedules. We hope that other members will consider the expected impact on businesses and individuals and review their decision.
“We also wish to assure foreign airlines operating in the country that all logistics and services for their operations remain in place as usual and that no disruptions whatsoever should be envisaged.
“As a government, we reiterate our commitment to the continued growth of the aviation industry where airlines and other service providers operate in a profitable and competitive environment.”
In the same token, the Federal Competition and Consumer Protection Commission (FCCPC) has warned airlines against selling tickets if they won’t operate.
The caution followed the information by Airline Operators of Nigeria (AON) on the shutdown of flight operations from today.
The carriers particularly blamed the high and increasing cost of jet fuel for their decision.
Though Ibom Air has announced that it would continue operations, others seem resolved to carry out the threat.
In a statement, FCCPC chief Babatunde Irukera, appealed to them to consider the effect of the proposed action on passengers.
The agency said it does not trivialise the challenge the current price of fuel poses to domestic aviation, coupled with other rising costs of operations and foreign exchange.
Irukera said talks were ongoing with the leadership of major fuel marketers to understand the global supply challenges and possible steps for resolution.
The commission advocated engagement among stakeholders to mitigate constraints and develop an interim arrangement to address problems associated with global supply on account of the war, sanctions and post-pandemic recovery.
The FCCPC, however, raised concern about rising consumer feedback that airlines have continued to sell tickets beyond the date announced for the proposed service shutdown.
“It will be egregious exploitation of consumers and a violation of law to purport to sell a service that the service provider knows, it will not, or does not intend to provide or deliver.
“It is misleading and deceptive under S.123 of the FCCPA to represent a service will be delivered on a certain date when the provider knows the same is false or improbable,” it said.
The statement expressed hope that airline operators will not deliberately sell tickets for flights they do not intend to operate.
Irukera said the agency would continue to monitor the evolving situation and remain committed to supporting engagements to provide solutions and stability.

By: Ike Wigodo