Despite the efforts of the Federal Government to increase the supply and consumption of Liquefied Petroleum Gas or cooking gas in the country, The PUNCH has learnt that the demand for the product has declined due to the low income and poor purchasing power of consumers.
Gas retailers told The PUNCH over the weekend that cooking gas demand had fallen as consumers could not afford the high prices of the product amid the rising inflation in the country.
“We are now experiencing low demand from consumers because inflation has pushed prices of goods and services above what the common man can bear,” a retailer around Isolo, Akinleye, said.
Another seller, John, around Oke-Afa, also said consumers now buy in smaller quantities or resort to other forms of cooking such as kerosene and charcoal.
“To worsen the case; most people don’t buy 12.5kg anymore. They now come with 5kg, or 6kg and even the smaller ones and augment it with other forms of cooking like kerosene and charcoal,” he said.
Market survey revealed that prices of a 12.5kg cylinder are now between N11, 000-N12, 000 depending on the area.
The President of the Nigerian Association of Petroleum and Gas Marketers, Dapo Olatunbosun, confirmed to The PUNCH that cooking gas demand had dropped despite the intervention of the Federal Government through the Nigerian Liquefied Natural Gas Limited, which had ensured consistent local supply and price stability.
He, however, did not state how much demand had fallen.
“The price is stable for now. it could have gone up if not for our cry.
“Every depot is wet now. Supply is better. Price is stable at N16m per 20 metric tons- it could have been worse. But demand is falling amidst the low income and poor purchasing power of people. Hope demand may go up slightly in December but would not be significant when compared with previous years,” he said.
The development comes amid the report that NLNG plans to shut down its six-train, 22 million tonnes per annum capacity plant in Finima, Bonny Island, Rivers State over a proposed routine maintenance operation scheduled to commence by February or March 2024.
The PUNCH had earlier reported how middlemen jacked up the price by 66 per cent in October alone.
Market survey carried out revealed that as of the beginning of October, the price of 20 metric tons at the terminal had moved from N10m to N16m, representing a 66 per cent rise in price within the space of one month.
Depot owners had blamed the sharp increase on depreciation in foreign exchange and increase in price at the international market.
However, outcry by gas retailers had resulted in the Federal Government summoning the Nigerian Midstream and Downstream Petroleum Regulatory Authority to an emergency meeting, The PUNCH has learnt.
“The federal government has stepped into the case, and has called NMDPRA for a meeting, because, everyone was saying the job of the regulator was to ensure sanity in the market,” he said, adding that prices of cooking gas should begin to reduce in the coming weeks.
“We expect prices to begin to drop starting from this week, so prices will no longer reach N18, 000 by December as earlier projected,” Olatunbosun told The PUNCH earlier this month.
“At least they (depot owners) now know that everybody is watching them, and they won’t be increasing prices anyhow like they used to,” he added.