Tougher times are ahead of gas consumers, as marketers have hinted that prices will go up next week.
The President of the Nigerian Association of Liquefied Petroleum Gas Marketers, Olatunbosun Oladapo, said gas consumers should brace themselves for price hikes starting next week.
He cited rising international prices, high tax rates and prices of vessels, forex scarcity, and naira devaluation as some of the reasons for the intended price review.
Olatunbosun described the imminent price increment as unfortunate.
According to him, consumers are now returning to firewood, charcoal, and sawdust for cooking.
He urged the government to tax profit and not products because consumers were not buying gas anymore.
His reaction came on the heels of findings by The PUNCH that vessel scarcity in the international market would push up local prices of Liquified Natural Gas, also known as cooking gas in the coming months.
Vessel scarcity in the international market has led to charter rate hikes, ahead of the 2023 winter, when demand for heating fuel peaks.
As of August 1, 2023, charter rates surged to $284,750 per day for November and $206,750/day for October, quadrupling the current price of $70,500/day, according to data from Spark Commodities quoted by Bloomberg.
The number of LNG vessels floating on the water for at least 20 days also rose in late July, with 42 vessels tracked, which is about 27 per cent higher than the same time a year earlier.
Nigerian LPG prices are internationally benchmarked based on Nigerian Liquefied Natural Gas Contract prices and are always influenced by international prices.
And like other internationally traded commodities subjected to price fluctuations due to market dynamics, the NLNG CP is subject to changes and can be reviewed either upwards or downwards at least once to three times.
The devaluation of the local currency would also impact the domestic price of LPG.
The dollar exchanged for N749.62 on Wednesday, according to the Central Bank of Nigeria.
The Nigerian LNG usually sells the cooking gas it produces locally to off-takers based on the prevailing exchange rate.
The PUNCH checks showed that the prices of 20 metric tonnes of LPG at the major depots in Apapa, Lagos, between July 28 and August 7 had been between N10.7m and 11m.
SOURCE: PUNCH NEWSPAPER