Cooking gas price rises on high import cost and 7.5% VAT
By Jeph Ajobaju, Chief Copy Editor
Refilling a 12.5kg cylinder of cooking gas has increased in price to N8,500 up from N7,000 in September 2021, the highest in over three years since November 2018.
Dealers and consumers are lamenting over the progressive hike in the price of Liquified Petroleum Gas (LPG), commonly known as cooking gas, across cities with households and small restaurants resorting to charcoal and firewood for fuel.
Joy Bright, who lives in Magboro, Akeran, Ogun State expressed fears over the rising cost of 12.5kg cylinder refill from N6,200 to N8,500 in a few weeks.
“I was not surprised when the attendant told me the price because I had said in July that the cost will rise further.
“I had no choice but to buy it, as other alternatives are not options for me. I would not have felt it much if the power supply was regular,” she said.
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High dependence on importation
A lady who referred to herself simply as Glory confirmed that she refilled a 12.5kg cylinder for N7,000 and lamented that the rising cost will have a severe impact on the cost of food bought from vendors.
“The cost of food items like rice, beans and even garri has been on the increase for months. This frequent hike in the cost of cooking gas will make matters worse, as several food vendors now use gas for their cooking,” she told Nairametrics which conducted the survey.
Chika Umudu, National Chairman of Liquefied Petroleum Gas Retailers branch of National Union of Petroleum and Natural Gas Workers Union (NUPENG), blamed the price hike on high dependence on the importation of gas.
He said Nigerian LNG, which accounts for more than 40 per cent of gas supply, should supply the domestic market in accordance with demand, rather than having a fixed quantity per annum.
Energy experts have expressed concern over Nigeria’s inability to deepen the penetration and utilisation of LPG despite being in a position to produce sufficiently to meet local demand.
Major Oil Marketers Association of Nigeria (MOMAN) in September 2021 protested against the reintroduction of Value Added Tax (VAT) on imported LPG.
They argued that the addition of VAT to the high price of gas, which is largely imported, will negate Abuja’s policy on the adoption of LPG.
MOMAN, the major stakeholders in the oil downstream sector, asked the government to remove 7.5 per cent VAT on cooking gas, warning that it will hamper gas adoption and the “Decade of Gas” agenda of the government.
