Rise in Aviation Fuel Price ‘ll Trigger Increase in Airfares, Airlines Warn

Chinedu Eze

Airline operators in Nigeria have raised the alarm over the skyrocketing price of aviation fuel by over 100 per cent to N400 per litre within a year and warned that it would lead to increase in the price of tickets in order to sustain their operations.

The operators lamented they are in a precarious situation because as the price of aviation fuel is increasing so is the exchange rate, which the airlines depend on for over 90 per cent of aircraft services, from aircraft maintenance, acquisition of spares, insurance, training and leasing.

The domestic operators, therefore, called on the federal government for urgent intervention on forex and also to look into the provision of modern facilities at the airports, especially airfield lighting on the runways so that flights could operate into the night.

Speaking with aviation correspondents yesterday at the Murtala Muhammed International Airport (MMIA), Lagos, the Chairman, United Nigeria Airlines (UNA), Dr. Obiora Okonkwo, bemoaned the sudden rise in the price of Jet A1 (aviation fuel) in the last one year, saying it has had a negative impact on the operations of airlines in the country.

According to him, when UNA commenced flight services on February 12, 2021, the price of aviation fuel was just N190 per litre, but regretted that the price has jumped to N400 per litre within a year.

He frowned at the rapid increase of the exchange rate, which also jumped from N340 to N570 to a dollar within the same period, urging the government to look critically into the development of the industry, especially relieving the airlines the problem they face in accessing foreign exchange.

Okonkwo stressed that the sharp rise in the price of aviation fuel, foreign exchange and other needs, has made it impossible for airlines to plan because things happen too fast and do not give room for authentic fiscal projections.

“The aviation industry in Nigeria has witnessed a whole lot of inconsistencies in the last one year. For instance, when we started on February 12, 2021, the price of aviation fuel was only N190 per litre, but today, the same product goes for N400 per litre. Also, the first foreign exchange we had about a year ago was N340 to a dollar, but today, it is between N450 to N570, especially if you are sourcing from the other market.

“However, despite the fall in naira, the base fare for ticket is still between N21, 000 to N23, 000. Aviation fuel could easily become about 30 to 40 per cent of your cost of operations and 99 per cent of aviation components are foreign exchange denomination. A ticket was about N2, 000 in year 2000, which was about $100 then, but look at the situation today.”

He, however, noted that despite the challenges enumerated, UNA Nigeria never compromise safety, which is key in air transport.

On flight delays and cancellations, Okonkwo explained that weather, limited and inadequate infrastructure play significant role and this includes lack of airfield lighting in most of the airports across the country, adding that 90 per cent of the airports in Nigeria are sunset airports, so airlines cannot fly to them after 6:30 pm.

On the future growth of the airline, he said UNA hopes to double its aircraft fleet from its current five to 10, while also concentrating on expanding operations in the domestic the West Coast and other African destinations.