KEY POINTS
- LPGAR blames rising Nigeria cooking gas prices on US-Iran global supply disruptions.
- A private refinery cut its ex-depot price by N170 per kilogram recently.
- LPG retailers say offtakers are undercutting independent retailers at the pump directly.
Nigerians trying to cook a meal are paying the price for a geopolitical standoff happening thousands of miles away. The Liquefied Petroleum Gas Retailers Association of Nigeria says rising cooking gas prices trace directly to global supply disruptions, with US-Iran tensions sitting at the center of the problem.
Ayobami Olarinoye, LPGAR chairman under the Nigeria Union of Petroleum and Natural Gas Workers, made the disclosure in Lagos on Saturday. He did not soften the message.
“The oil and gas sector operates within a global market,” Olarinoye said. “It is difficult to isolate our LPG from global developments.”
Prices slowly easing but pressure remains
The picture is not entirely bleak. Olarinoye said prices are beginning to ease. More shipments are entering the market through Nigerian LNG offtakers and imports. A private refinery recently reduced its ex-depot price by N170 per kilogram, moving down from N1,400 per kilogram. The reduction is marginal but it signals movement in the right direction.
Still, Olarinoye said the structural problems run deeper than global tensions. He said consumption of cooking gas has risen sharply in Nigeria, and the country’s storage capacity has not kept pace.
“The consumption pattern for LPG has changed significantly and increased substantially,” he said. “We need more storage capacity and related facilities.”
He urged the government to invest in more refineries, especially those focused on LPG production. He also called for closer cooperation across the supply chain.
Retailers caught in a squeeze
Independent retailers are dealing with a separate problem closer to home. Olarinoye alleged that some LPG offtakers who operate their own retail outlets sell directly to consumers below the price independent retailers pay at wholesale.
“We discovered that some offtakers who own retail stations sell to end users at lower prices,” he said.
He described the practice as one requiring investigation by relevant authorities. The price gap is making business increasingly difficult for association members and creating the false impression that retailers are responsible for price increases caused by forces outside their control.
“The margin between wholesale and retail prices is making business difficult for our members,” Olarinoye said.
He said LPGAR remains sympathetic to Nigerians who made the switch to cleaner cooking energy and now face a harder financial reality at the gas station.
