Marketers of Liquefied Petroleum Gas (LPG), popularly known as cooking gas, have decried the continuous rise in the price of the item, saying prices now rise by N550,000 per truck daily. The marketers also alleged possible manipulation in the LPG supply system by persons who might be causing the constant increase in prices, despite the claim that the 7.5 per cent Valued-Added Tax (VAT) on imported LPG had not been activated yet.
The marketers, under the aegis of Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), said that the cost of a truckload of LPG at the depot had risen to over N10.10 million as at last Friday, debunking the notion that prices had started dropping.
Executive Secretary of NALPGAM, Mr. Bassey Essien, said that as at Friday, they bought the product around N10.10 million per truck, even higher than what they bought the previous weeks.
Essien said when the price was coming down some weeks ago it did not drop below N9.6 million per truck, adding that the price is rising higher at the moment at the LPG terminals.
The price of LPG has been on the rise since late 2020 as a result of gas shortage due to limited in-country supply and reduction in the importation of LPG by the marketers.
Many factors are fuelling this, including inflation, forex, limited supply by the NLNG, and VAT on imported LPG that is still in limbo.
These had led to the sharp increase in the prices of LPG both at the retail level and at the depot.
At the retail level, a 12.5 kilogramme cylinder refilling unit had risen from about N3,400 early 2021 to as high as over N9,000, depending on the location. It still sold above N8, 000.
At the depots, a truckload of the product rose from about N4 million to over N10 million, according to marketers.
Essien said, “The cost of a truck was around N9.6 million, N9.5 million and, suddenly, it went back to N10.10 million with extra N550,000 just yesterday.
“When it was going up, it was going up at the rate of N200, 000 to N500,000. The one it came down last week (penultimate week), it was coming down at N50,000. But suddenly, yesterday (last Friday), it went up by N550,000.
“May be, somebody along the line is manipulating the system, or some people along the line are not telling us the truth. The marketers buy what the terminals sell to them. So, what is going on at the terminals?”
He expressed concern over the inability of the government to categorically state its position on LPG VAT, pointing out that the terminal owners are using that as an excuse to keep hiking the price.
Essien said, “Government said they wanted to start VAT, Customs Duties and, yet, they said they have not even started implementing it. So, why is the price high?
“Ask NLNG how much they are giving this product to the terminal owners or the off-takers, so that we know why it is expensive as that. Why did it increase by N550, 000 per truck yesterday?”
He expressed displeasure at government’s inability to address the LPG crisis in the country, noting that the federal government keeps saying it is working towards bringing down gas prices without being specific about what it is doing.
Essien said prices would only come down if there was a sustained increase in volume of LPG going to the market, either through importation or through supply by the Nigeria LNG Limited.
The NALPGAM chief executive also faulted the latest claim by the Nigeria LNG Limited that it was set to dedicate 100 per cent of its LPG production to the domestic market, dismissing the claim as an old tale.
NLNG had, in a statement last Friday, announced that it was set to supply 100 per cent of its LPG production to the domestic market, after saying last year that it had committed 450,000mt -100 per cent of its LPG production to the market.
Essien said the statement by NLNG was not specific on the actual volume of supply. He said the company had said at a forum last year that it had committed 450,000mt of its butane production to the country.
Essien wondered why the company would be coming out now to announce that it was set to supply 100 per cent of its LPG production without stating the actual volume.
Asked if that announcement would have any major impact on the already troubled market, Essien said there could be no impact from it, as it was the same old story.
He said, “What was the volume they said they were putting to the local market? And now they are saying they are going to go 100 per cent, what volume are they anticipating?
“Same last year, at the height of the increase in prices that was everywhere, they said their total production for propane was 450, 000 which they said they had committed to the market.
“So, if they committed 100 per cent of that last year, and they are telling us now that they are set to do 100 per cent, so what are they saying?
“Let’s wait until they mention the amount. But if it is the same 450,000, then there is nothing to comment on. Let’s forget about semantics. We want to know what the 100 per cent translates to in volume.”