Business

Aviation Fuel: Domestic Airlines Risk Shutting Down Over Rising Price Of Jet A1

Published

1 year ago

April 1, 2024

Indications have emerged revealing that some domestic airlines may cease operations over the rising price of aviation fuel, otherwise known as Jet A1.

Given that there has been a sustained increase in the price of aviation fuel over the last two years, airlines have been forced to enhance their operations by raising ticket prices.

In less than eight months, specifically between July 2023 and February 2024, the product’s swinging price saw local carriers struggle with 109 per cent price increment.

The 12 scheduled airlines in the country, including Air Peace, Aero Contractors, Arik Air, Max Air, Azman, Dana Air, Ibom Air, Green Africa, Overland, Rano Air, ValueJet and United Nigeria Airlines, UNA, had made efforts to stay in business, even as the price of jet fuel surged from N629 to N1,316.

With the situation no longer sustainable, some airlines are looking at discontinuing operations, Vanguard has gathered.

Fluctuations

Although efforts to get the price of jet fuel as of press time failed, Chief Operating Officer of Ibom Air, Mr George Uriesi, told Vanguard that it was fluctuating between N1,300 and N1,500.

Uriesi said: “It is a massive challenge because fuel is the major cost. In two years, it has gone from about N200 to N1,500. No matter how prudent an airline is, it cannot absorb that kind of increase in the major cost input. The increase is so massive that it is difficult to attack by raising fares. We think that we have reached the plateau in terms of using fares to absorb all these inflationary issues – the value of naira and increase in price of fuel, which are the two most important components for a domestic airline.

Reached the zenith

“I think we have reached the zenith of how much we can charge higher for people to travel without stopping them from buying tickets. What I can say right now is that the recent strengthening of the Naira was just like an oxygen mask for the domestic airlines because it had reached the point where it was no longer sustainable. I don’t think any other group of airlines in the world faces the challenges that Nigerian airlines face.”

Refining

Managing Director of Aero Contractors, Captain Ado Sanusi, in a chat with Vanguard, also warned that if the country does not start refining Jet A1, the situation might worsen.

He said: “Cost has been skyrocketing and from the normal 35 to 40 per cent of airlines’ cost, it has now jumped to close to 80 per cent. And in some cases, 90 to 95 per cent. It means when tickets are sold, 90 per cent of the ticket goes to buying Jet A1. It’s a direct relationship. When the price increases, cost increases.

“Airlines increase the prices of their tickets and transfer the cost to the customer. Until we start refining jet fuel in the country, we will depend on imports. While we are depending on import, we are looking at the cost with a naira to dollar exchange rate. I don’t know whether Dangote and Port Harcourt refineries are equipped to refine Jet A1, but even if they are, it would take a little bit of time before we feel the impact.”

Cartel

While calling on Federal Government to make importation of jet fuel transparent, Sanusi said: “If the federal government can make the importation as transparent as possible, I think it will give the airlines a picture of what the price will be. If the price can be published by the Department of Petroleum Resources, DPR, we will know the price and that there is no cartel fixing the price. If they do that, I think it would stabilize the price because right now, some airlines are struggling and some will continue to struggle until they struggle no more and then give up.”

VANGUARD

Business

Fuel Scarcity Imminent As NUPENG, Dangote Face-off Festers Business

Published

13 hours ago

September 5, 2025

Editor

The stability in the distribution and availability of petroleum products being enjoyed by Nigerians is about to be aborted as a result of the seeming cold war between the management of the Dangote Refinery and one of the umbrella unions of workers in the oil industry, the Nigeria Union of Petroleum and Natural Gas Workers (NUPENG).

NUPENG, in a statement jointly signed by Comrades Williams Akporeha and Afolabi Olawale, President and General Secretary, respectively of NUPENG and issued to newsmen in Abuja on Friday, the Union accused the management of Dangote Refinery of alleged anti-labour practices, inimical to the survival and means of livelihoods of its members under its Petroleum and Tanker Drivers Branch.

The Union specifically expressed strong reservations about the position of Chairman of Dangote Refinery, Aliko Dangote, that drivers recruited for operations of its 10,000 Compressed Natural Gas (CNG) Trucks imported into the country would not be allowed to join any trade union.

The Union described the position taken by the management of Dangote Refinery as an affront on the right of association, guaranteed under the 1999 Constitution, and a breach of relevant international labour laws to which Nigeria is a signatory.

The NUPENG recalled several meetings it initiated, jointly with the leadership of the Nigerian Association of Road Transport Owners ( NARTO), to prevail on Aliko Dangote to rescind his stance not to allow its drivers to join trade unions. The Union expressed regret that its appeals fell on deaf ears.

“Arising from the unfortunate outcome of the meeting, the leadership of the Union has made several efforts to get relevant institutions of the country to make Alhaji Aliko Dangote and his cousin, Alhaji Sayyu Ali Dantata, follow the line of global best practices and decency, but all to no avail.

“To our utmost shock, Alhaji Sayyu Aliu Dantata’s MRS commenced the recruitment of drivers for the imported CNG Trucks on Friday, 29th August 2025. “The drivers being recruited are being forced to sign an undertaking not to belong to any existing union in the Oil and Gas Industry.

“NUPENG is seriously concerned and disturbed with the unconscionable business practices of Alhaji Sayyu Aliu Dantata and Alhaji Aliko Dangote, who are scared of allowing unions to exist in their business outfits. To us, amassing wealth on the basis of enslavement, depriving workers of a union and a voice, amounts to creating filthy wealth.

“NUPENG will not stand idly by while these billionaires seek to destroy the livelihoods of thousands of workers, including tanker drivers.

“NUPENG stood in solidarity with Dangote Refinery during its construction and commissioning.

“We did so in good faith, in expectation that it would create jobs, strengthen local capacity, and benefit the Nigerian people, under a conducive atmosphere for unions to thrive.

“Unfortunately, Alhaji Aliko Dangote has chosen to betray that trust by scheming to monopolise distribution, crush competition, and enslave the sector and raise prices, which would ultimately result in an attack on the living standards of the masses of ordinary Nigerians.

“This is not philanthropy, it is economic sabotage!”
While appealing to relevant oil industry regulatory agencies to wade into the unfolding crisis, the Union dropped the hint that it would call on its members to down tools and shun loading of petroleum products, effective from Monday, September 8.

“We call on the Nigerian Midstream & Downstream Petroleum Authority (the Authority, for
short) to invoke its powers under Section 32(u) & (aa) of the Petroleum Industry Act (PIA). Under those two provisions, the Authority is empowered to promote competition and private sector participation in the midstream and downstream petroleum operations.

“The Authority has responsibility to identify, investigate, and prevent abuse of dominant positions and
restrictive business practices with regard to midstream and downstream petroleum operations.

“Nigeria is a member of the international community and a member state of the International Labour Organisation. Nigeria has ratified Convention No. 87 of 1948, the Convention on Freedom of Association and Protection of the Right to Organise, 1948. This Convention had
been ratified by Nigeria as far back as 17th October 1960. Under the Convention, workers have the right to join unions of their choice, for the protection of their employment and trade union rights, and without prior authorization of any employer or authority.

“Indeed, by virtue of section 254C (2) of the Constitution of Nigeria, a ratified ILO Convention is a constitutional provision.

“Therefore, any practice or policy by any employer that seeks to deprive workers of the right of association is an affront to the Constitution.

“Above all, the rights of association, including membership of trade unions, are guaranteed by Section 40 of the Constitution. Alhaji Aliko Dangote and his cousin, Alhaji Sayyu Aliu Dantata, should not be allowed to enslave Nigerian workers. They should be made to be lawful business persons and not lawless individuals or business outfits. Nigeria is a country of laws, not a lawless society.

“By this statement, we call on the Federal Government of Nigeria and its agencies, including well-meaning segments of the Nigerian society, to call the two trillionaire businessmen to order. They should be told to obey the laws of Nigeria. If they persist in their anti-union, tyrannical attitudes, NUPENG is set and ready to mobilise its forces to fight within the framework of the law.

“Meanwhile, since Alh Aliko Dangote and his cousin have resolved to replace all Petroleum Tanker Drivers in Nigeria, and no one or institution can stop them, the members of the Petroleum Tanker Drivers Branch of NUPENG will, from Monday, 8th September 2025, start
looking for alternative employment/skills and sources of livelihoods.

“We plead with the general public to bear any inconveniences our struggle against this tyranny and indecency may cause.“
(TRIBUNE)

Business

FG Offers Up To 16.54% Yield On September Savings Bonds

Published

4 days ago

September 1, 2025

Editor

The Federal Government, through the Debt Management Office, is offering investors annual yields of up to 16.541% on its September 2025 Federal Government of Nigeria Savings Bonds.

The DMO, in a circular on its website on Monday, announced that the subscription window opens immediately and will close on Friday, September 5, 2025, with settlement scheduled for September 10, 2025.

Coupon payments will be made quarterly on March 10, June 10, September 10, and December 10 and will be paid directly to investors.

The DMO offered investors two subscription categories of the Federal Government Savings Bond.

The first is a two-year bond, which will mature on September 10, 2027, and attracts an annual interest rate of 15.541 per cent.

The second is a three-year bond, set to mature on September 10, 2028, with a higher annual interest rate of 16.541 per cent.

The two-year bond interest rate rose to 15.541% in September 2025, up from 14.401% in August.

Similarly, the three-year bond recorded an increase to 16.541% in September, compared to 15.401% in the previous month.

The FGN Savings Bond programme, launched in 2017, aims to deepen the domestic bond market, promote financial inclusion, and give retail investors access to secure, low-risk government securities.

Each bond unit is priced at ₦1,000, with a minimum subscription of ₦5,000 and additional subscriptions in multiples of ₦1,000. Individual investors can subscribe up to ₦50 million.

On the status of FGN Savings Bonds, DMO noted it “qualifies as securities in which trustees can invest under the Trustee Investment Act; Qualifies as Government securities within the meaning of Company Income Tax Act (“CITA”) and Personal Income Tax Act (“PITA”) for Tax Exemption for Pension Funds, amongst other investors.

“Listed on The Nigerian Exchange Limited (and); qualifies as a liquid asset for liquidity ratio calculation for banks.”

The office said the bond is “backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of Nigeria.”

Business

NNPCL Reduces Fuel Price After Dangote Refinery’s Adjustment

Published

3 weeks ago

August 14, 2025

Editor

The Nigerian National Petroleum Company Limited has reduced its premium motor spirit pump price on Thursday, according to DAILY POST.

It was confirmed that NNPCL retail outlets in the Federal Capital Territory, Abuja, have reduced their pump price to N890 per litre from N945.

This new fuel price has been reflected in NNPCL retail outlets such as mega station Danziyal Plaza, Central Area, Wuse Zone 4, Wuse Zone 6, and other of its filling stations in the nation’s capital.

The latest downward review of fuel price in NNPCL outlets represents an N55 reduction in fuel pump price.

“It was reduced to N890 per litre this afternoon, down from N945,” an NNPCL fuel attendant told DAILY POST anonymously on Thursday.

This comes a Nigerian filling station, MRS Empire Energy, on Thursday adjusted their fuel pump price to N885 and N946 per litre, down from N910 and N955 per litre.

The latest fuel price reduction trend is unconnected to Dangote Refinery’s ex-depot petrol price adjustment by N30 to N820 per litre from N850 and the price of crude oil in the international market.