Emmanuel Addeh in Abuja
In spite of the federal government’s decision to withdraw the 7.5 per cent Value Added Tax (VAT) to crash the price of Liquefied Petroleum Gas (LPG), also known as cooking in November last year, the rates Nigerians buy the product failed to drop in December, THISDAY has found.
Latest data from the National Bureau of Statistics (NBS) showed that while LPG prices were expected to fall last month due to the policy, the amount for refilling a 12.5 kilogramme cylinder, rose 12.31 per cent year-on-year and 3.18 per cent month-on-month, from November.
After several months of public outcry by consumers and retailers, the federal government had finally in November last year, decided to withdraw VAT and customs duty to ameliorate the hardship faced by citizens during the last Christmas celebrations.
Acknowledging the rising prices, a month before Christmas, the Minister of State Petroleum Resources (Gas), Ekperikpe Ekpo, said that prices were fast going beyond the reach of Nigerians, explaining that plans were on to reduce the price of gas.
“With the exponential increase in the price of LPG, there is the need for the federal government to intervene,” he stated. Generally, gas prices have increased from less than N500 a kilogramme a few years ago to over N1,100 now.
Aside contradicting Nigeria’s ‘Decade of Gas’ initiative which seeks to ramp up cooking gas penetration nationwide, rising prices also push users to dirtier alternative sources like firewood.
In November, after removing VAT, the federal government said customs duty payments from cooking gas imports was also withdrawn in a letter written to several government agencies.
The memo was signed by the Minister of Finance and Coordinating Minister of the Economy, Wale Edun and addressed to the Special Adviser to the President on Energy, the Comptroller-General of the Nigeria Customs Service (NCS), the Chairman of the Federal Inland Revenue Service (FIRS), among others.
But the aim of the VAT and customs duty withdrawal appeared not to have impacted much on prices, according to NBS data.
According to the information, the average retail price for refilling a 5kg cylinder of LPG increased by 2.79 per cent on a month-on-month basis from N4,828.18 recorded in November 2023 to N4,962.87 in December 2023.
On a year-on -year basis, this increased by 8.70 per cent from N4,565.56 in December 2022. On state profile analysis, Adamawa recorded the highest average price for refilling, with N5,725.33, followed by Jigawa with N5,686.88, and Lagos with N5,671.05.
On the other hand, Ebonyi recorded the lowest price with N4,071.43, followed by Imo and Abia with N4,088.24 and N4,155.88 respectively.
In addition, analysis by zone showed that the North-east recorded the highest average retail price for refilling a 5kg cylinder, with N5,256.61, followed by the North-west with N5,144.50, while the South-east recorded the lowest retail price with N4,155.59.
“Also, the average retail price for refilling a 12.5kg cylinder of liquefied petroleum gas increased by 3.18 per cent on a month-on-month basis from N11,155.15 in November 2023 to N11,510.16 in December 2023.
“On a year -on-year basis, the retail prices rose by 12.31 per cent from N10,248.97 in December 2022. On state profile analysis, Cross River recorded the highest average retail price for the refilling of a 12.5kg cylinder, with N13,572.22, followed by Edo with N13,265.63 and Delta with N13,041.67,” the report stated.
Conversely, the NBS noted that the lowest average price was recorded in Ebonyi with N10,142.86, followed by Imo and Anambra with N10,150.90 and N10,264.29 respectively.
Analysis by zone showed that the South-south recorded the highest average retail price for refilling a 12.5kg cylinder, with N12,700.14, followed by the North-central with N11,585.89. In contrast the South-east recorded the lowest price with N10,632.14.
Nigeria has one of the largest gas deposits in the world, that is over 206 trillion cubic feet, but has been unable to effectively harness it due to lack of investment in gas infrastructure over the years.
Also, the average retail price paid by consumers for petrol last month was N671.86, indicating a 225.85 per cent increase when compared to the value recorded in December 2022, which was N206.19.
Likewise, comparing the average price value with the previous month (.i.e. November 2023), the average retail price increased by 3.53 per cent from N648.93.
On state profile analysis, Ogun state had the highest average retail price for petrol at N776.54, Taraba and Adamawa states were next, with N760.00 and N745.71, respectively.
On the other hand, Kano, Lagos and Borno States had the lowest average retail prices for petrol, at N602.78, N612.72 and N622.71 respectively.
Lastly, on the zonal profile, the North-east zone had the highest average retail price of N699.82, while the North-central zone had the lowest price of N657.69.
As for diesel, the data showed that prices paid by consumers increased by 37.76 per cent on a year-on-year basis from a lower cost of N817.86 per litre recorded in the corresponding month of last year to a higher cost of N1126.69 per litre in December 2023.
On a month-on-month basis, an increase of 6.74 per cent was recorded from N1055.57 in the preceding month of November 2023 to an average of N1126.69 in December 2023.
“Looking at the variations in the State prices, the top three states with the highest average price of the product in December 2023 include Sokoto State (N1300.00), Kebbi/Yobe State (N1250.00) and Jigawa state (N1229.09).
“Furthermore, the top three lowest prices were recorded in the following states, namely: Rivers State (N897.89), Bayelsa State (N935.00) and Bauchi State (N985.00).
“As for kerosene, the average retail price per litre paid by consumers in December 2023 was N1,362.27, indicating an increase of 5.84 per cent compared to N1,287.10 recorded in November 2023. On a yearly analysis, the average retail price per litre of the product rose by 23.33 per cent from N1,104.61 in December, 2022, “the report said.
