LPGAR condemns arbitrary increase in price of LPG, supply shortages

Members of Liquefied Petroleum Gas Retailers, LPGAR, a branch of Nigeria Union of Petroleum and Natural Gas Workers, NUPENG, have condemned the current arbitrary increment in price of LPG and supply shortages.

Our Energy Correspondent, National, reports that the Branch Secretary of LPGAR, Comrade Olukayode Aborisade Solomon, in a statement declared that LPGAR is highly dissatisfied with sudden upsurge in price of liquefied petroleum gas, LPG, by tank farm (LPG depots) operators and what appears to be a deliberate reduction in supply or rotation of supply amongst the tank farms.

These, the group said, had led to about 90 per cent increment in gas price within a space of one week. It is likely that this ugly situation will continue if there is no urgent intervention especially as Christmas and New Year approach. 

“Though the increment began about a month ago but did not significantly reflect in the price sold to end-users because retail outlets had absorbed the difference believing it would soon normalize. However, without any sign of imminent supply or pricing crisis, the price in the last one week suddenly skyrocketed, reaching about 90 per cent high. Just a week ago in Lagos and some neighbouring states, 12.5kg of LPG was sold between N2,600 and N3,000 in retail outlets. It is now sold between N4,000 and N4500 at retail outlets owing to sudden hike in the price by tank farm operators. 

“If this situation remains unchecked it is capable of undermining the expected development of LPG sector in the country which has been championed by the government and other stakeholders over the years.

“Nigerians especially the low income earners who are beginning to adapt to LPG for both domestic and commercial uses are being subjected to exploitations at the time they are already being confronted with economic hardships.

“The situation is already forcing many users to abandon their cylinders and opt for other sources of cooking energy such as firewood and saw dusk irrespective of the attendant health risks and resultant environmental degradation that results from those alternative energy sources.” 

Solomon said LPG retailers have to contend with end-users who often accuse them of being responsible for the increments. Unknown to most of the end-users, LPG retailers are the worst hit as they have been reduced to the status of mere agents toiling day and night to make LPG available to Nigerians often with little or no profits because of the monopoly of a cartel.

“Our union over the years has been decrying what it views as manipulation of the sector by a few privileged individuals and business concerns in Nigeria including some multinationals operating in the oil and gas sector.

“The people behind the business organizations benefiting from this arbitrariness are the same people that have been creating the impression within the government quarters that insufficient retail outlet in Nigeria is the problem militating against the deepening of LPG in the country. This they do in order to secure approvals and incentives for establishment of retail outlets to the detriment of small and medium size LPG businesses. They, therefore, neglect the major areas they are expected to concentrate which include LPG production and provision of storage facilities (tank farms).

“If enough production or importation of LPG is made and enough storage facilities provided, LPG would become affordable and accessible to Nigerians because there are hundreds of thousands of business-minded Nigerians who are willing and ready to penetrate even the remotest villages to stimulate LPG usage and also meeting demands.

“Our union is calling on the government and the rest of the stakeholders to urgently intervene in order to restore sanity. There is nowhere in the world that government leaves such a vital sector solely in the hands of a few commercial interests especially where there is apparent case of manipulation.”

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