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Marketers blame oil price and forex as cooking gas price rises again

By on March 29, 2022 0

Traders of liquefied petroleum gas, commonly known as cooking gas, said on Monday that the cost of LPG continued to rise on a weekly basis due to the falling naira against the US dollar and rising global prices. crude oil.

Speaking under the Liquefied Petroleum Gas Retailers branch of the Nigerian Petroleum and Natural Gas Workers Union, LPG dealers said the cost of the product was currently determined by market forces .

NUPENG LPG Retail Branch President Chika Umudu told our correspondent that in the last two weeks the cost of 12.5 kg of LPG has increased by around N300.

About two weeks ago, traders in the product sounded the alarm in a statement issued by the union about the continuing rise in the price of cooking gas.

They had urged the government to intervene, given the energy crisis in Nigeria, as evidenced by the declining electricity supply and the prolonged shortage of gasoline.

When asked on Monday whether the cost of the commodity is stabilizing, Umudu replied, “The price has continued to rise. Between the time we published this press release and now, the 12.5 kg gas has increased from 200 N to 300 N.

“In some cases, dealers usually don’t spot the increment immediately. There is a way to remove it, but when we can’t, we release the price.

As to whether there had been a government response based on the body’s recent appeal, he replied in the negative, pointing out that the cost of LPG was currently determined by the exchange rate and oil prices. raw.

Umudu said, “No response from the government. The situation is now linked to market forces, which include exchange rates and the price of oil on the international market.

“The recent rise in the dollar rate is one of the main factors behind the increase in the price of cooking gas. The rise in the price of the dollar is a major factor, coupled with the increase in world crude oil prices.

“The weakening of the naira is one factor that has really impacted the cost of LPG. However, there are other minor issues such as low resource utilization capacity.

Umudu, however, noted that the union’s call for government intervention was still tenable, adding that if the naira continued to fall against the dollar, the cost of cooking gas would continue to rise.

He said the cost of 12.5kg of LPG currently ranges between N9,000 and N10,000 depending on where it is purchased and could increase further depending on market forces.

Umudu said the NUPENG branch union considered it ironic that such price increases were occurring at a time when the government, through political pronouncements, was assuring Nigerians of adequate supply of the product at affordable prices.

“Recall that between December 2020 and the first months of 2021, the government, through its various programs, inaugurated the gas expansion program which is labeled ‘Gas Decade’,” he said.

He said the aim of the program was not only to make LPG available to all Nigerian households, regardless of income level, but also to expand the use of gas for other purposes. such as automotive and public/private power generation.

Umudu said, “This assumes that the enabling infrastructure would have been in place before inauguration, but events immediately after inauguration prove otherwise.

“It’s not as good at this time when efforts should be in high gear to expand the use of LPG in the country as a way to reduce environmental pollution, deforestation and desertification.”

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