Cooking gas gets cheaper as export ban credited with price drop

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The price of Liquefied Petroleum Gas (LPG), commonly known as cooking gas, has witnessed a significant decline following a government export ban implemented in February 2024. Cooking gas marketers are crediting the ban with this positive development for Nigerian consumers.

Cooking gas dealers under the aegis of the Nigerian Association of Liquefied Petroleum Gas Marketers disclosed this during a courtesy visit on the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, in Abuja.

According to the National Association of Liquefied Petroleum Gas Marketers (NALPGAM), the cost of cooking gas has dropped from an average of N1,500 per kilogram to around N900/kg. This translates to a price reduction of roughly 40%, offering some relief to Nigerians who have been grappling with rising living costs.

Speaking at the meeting with the gas minister on Wednesday in Abuja, the National President, NALPGAM, Oladapo Olatunbosun, commended Ekpo for the courage in ordering the domestication of all LPG produced within the country, stressing that the policy resulted in the reduction and stabilisation of the product’s price in the domestic market.

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The NALPGAM president thanked the Federal Government for heeding their plea, as the government’s intervention made the price of LPG that was sold for N20m per 20 metric tonnes reduced to N15m.

At the retail end, there is a corresponding decrease from N1,400 – N1,500 per kilogram to between N900 – N1,000 per kilogram, according to the gas marketer, as contained in the statement.

The government’s decision to halt LPG exports stemmed from concerns about soaring domestic prices. In the months leading up to the ban, Nigerians reported a sharp increase in the cost of cooking gas, with some areas experiencing prices as high as N20,000 per 20 metric tonnes. This price surge was attributed, in part, to the prioritization of exports over domestic supply.

The NALPGAM President expressed his appreciation to the government for taking action. He highlighted the positive impact on consumers, stating that the price reduction makes LPG a more accessible cooking fuel for many Nigerians.

Lingering Questions

While the price decrease is welcome news, some questions remain. The long-term effects of the export ban on the LPG industry are yet to be fully understood. It’s important to consider whether the ban could discourage investment in domestic LPG production or disrupt established trade partnerships.

Market Dynamics

The sustainability of the current price point is another factor to be monitored. External factors influencing global LPG prices could potentially trigger fluctuations in the domestic market. Additionally, the effectiveness of the export ban in regulating supply and demand requires ongoing evaluation.

Looking Ahead

The success of the export ban hinges on its ability to achieve a sustainable balance between domestic needs and export opportunities. Continued monitoring and adjustments by the government, alongside industry collaboration, will be crucial in ensuring that affordable cooking gas remains accessible to Nigerian households.