Business Hilights
Tracking Nigeria's Headline Business News Online

Aviation fuel scarcity resurrects at Nigerian airports, Jet A1 jumps to N260 per litre

Strong indications have emerged showing that scarcity of aviation fuel has resurfaced in Nigeria as airlines weekend observed that price of Jet A1, otherwise known locally as aviation fuel, to an all-time high of N260 per litre from N180 per litre.

Some experts who spoke to our correspondent on Monday averred that more airlines may be forced to close shop if the situation was not brought under control as soon as possible.

Efforts to get the views of relevant government agencies on the matter failed, but there are signals that the Nigeria Civil Aviation Authority (NCAA) may issue a statement on the matter very soon.

Already there are speculations that local airlines who could not join international carriers to refuel in Ghana, spend well above 40 percent of their expenditure on fuel before even as their counterparts globally spend about 29 percent.

Though Med-View Airline was quick to reveal that it had expended at least N22 billion in the purchase of the product in the past five years to fuel its aircraft, it was mute on what it had made as income within the same period under review.

The airline however called on the relevant authorities to intervene in the situation before it degenerated.

Findings across airports in Nigeria showed variance in price between them as whereas Jet A1 sells for N220 per litre in Lagos; depending on the volume an airline is buying and the marketer involved, it goes for N250 and N260 in Kano, Kaduna, Maiduguri and other states.

Though no clear reason has been adduced for the sudden scarcity which observers say may cause hike in airfares very soon, less than a year ago, the product was sold for N180 per litre across board.

However, key discovery cannot be unconnected with the fact that the product remains imported and considering rising oil prices in the international market and cost of importation which had been surging recently especially in Nigeria as pirates attacks intensifies, the normalization of the price may take some time.

Aside rising crude oil prices and piracy, some marketers are linking the scarcity to shortage of foreign exchange from the Central Bank of Nigeria (CBN) which now force importers to source exchange from rather exorbitant places to remain in business.

Speaking with Business Hilights weekend in Lagos, Mr. Muneer Bankole, Chief Executive Officer (CEO) of Med-View Airline, revealed that the Airline Operators of Nigeria (AON), the umbrella body of airlines in the country, was studying the situation and may make a pronouncement on it soon.

He averred that “We had an AON meeting recently, one of the subjects we discussed was looking at the fuel issue in Nigeria. We cannot continue in this way. We are at the mercy of the marketers and sometimes, they claim they don’t get the forex, but the CBN said they have been giving allocations.

Bankole added that “In importing this product, three things are involved; the man gets his licence to import the fuel either by ship or any other means. This is one owner. Another owner who receives the fuel to keep for the man too has his own value. And then, it gets to the fuel browsers who store the product within the airport environment and, today, because of the security situation, they don’t go to Maiduguri.

Continuing, he disclosed that “So, the few ones that get the product there sell at N250 and N260 per litre. Some go as high as N270. Who is responsible for all these? It is the government and they should address the situation. Our fuel consumption in the past five years is about N22 billion”.

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