…as dealer predicts more increase
Written by: Ubong Sampson– Uyo
It has been disclosed that the recent and harsh inflation in the cost of Liquefied Petroleum Gas (LPG) commonly known as cooking gas is triggered by factors including high foreign exchange rates and value added tax, among other factors.
The cost of the commodity has shot up by over 100 per cent within the last eight months.
It was recently gathered that government effected the VAT charge on gas imports about three weeks ago, while some dealers were also mandated to pay the tax for commodities imported several months ago.
While operators confirmed that Nigeria imports about 70% of cooking gas consumed by citizens, the National Chairman, Liquefied Petroleum Gas Retailers Association of Nigeria, Michael Umudu attributed the inflation to foreign exchange rates, the newly effected value added tax and the rise of petroleum products in the international market.
“NLNG supplies about 35 per cent of the gas we consume locally and that percentage is not adequate. And the gas sold by NLNG is even sold at international price and is priced in dollar not naira.
“20MT is now in the average of about N8m. And before VAT was introduced, the price of 20MT was around N6.8m to N7m, which was the highest price then”, he added.
While the product sold at about N3,500 for 12.5kg as of the beginning of the year, it barely got to July when the price increased to N5,500 and then to N6,500 and even more by the retailers, upon the effect of VAT some three weeks back.
According to a retail dealer simply identified as Wonun, who operates around Shelter Afrique Estate axis in Uyo, the price hike seems to be happening on a daily basis and we can’t tell when it will stop. He added that top operators in the country have been appealing to the government to find a way of causing the NLNG to increase its domestic supply so that the product can be affordable.
Meanwhile, most small scale food vendors and food outlet operators have resorted to firewood as an alternative energy source, as they have admitted not being able to afford the high cost of the product as it concerns cooking of large quantity meals.
