Experts Share 3 Reasons for Cooking Gas Scarcity As Dealers Releases New Prices for 1kg

• Resident of Lagos and other states in the South West Region are experiencing cooking gas scarcity
• "Long queues have been observed at gas stations, while many outlets remain closed, forcing buyers to pay as much as N3,200 per kilogram
• Three issues have been identified as the reasons Nigerians are facing cooking gas scarcity majorly in Lagos

Legit.ng journalist Dave Ibemere has over a decade of experience in business journalism, with in-depth knowledge of the Nigerian economy, stocks, and general market trends.

The price of refilling liquefied petroleum gas (LPG) also known as cooking gas has skyrocketed in recent days due to scarcity in major cities such as Lagos, Ibadan, and Abeokuta.

Residents in Lagos over the weekend paid as much as ₦3,200 per kilogram, a 190% increase compared to the previous price of N1,100 per kg.

The new prices released by many dealers mean it would cost N32,000 to refill a 10kg cylinder of cooking gas.

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Cooking gas scarcity hits major cities as prices surge over 80%, dealers blame Dangote Refinery

Here are the 3 reasons for the cooking gas scarcity and price hike

Analysts say the scarcity is the ripple effects of multiple disruptions.

Supply challenges

The National President of the Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM), Olatunbosun Oladapo, confirmed that the scarcity was largely limited to the South-West, noting that supply remained stable in other regions, Guardian reports.

Oladapo said:

“The scarcity is not nationwide. Gas is available in the South-South and East, but the South-West experienced shortages due to recent disruptions.

"Maintenance was carried out at Dangote, and immediately after that, PENGASSAN embarked on strike, which delayed vessels carrying gas from NLNG. Now that terminals have resumed trucking, the backlog will take two to three days to clear."

He added that the Dangote Refinery had resumed product lifting and started issuing pro forma invoices to off-takers a move expected to stabilise supply in the coming days.

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Industry observers note that even short-term disruptions from the 650,000-barrel-per-day refinery can shake the domestic LPG market, given its growing influence.

The temporary pause, though necessary for maintenance, created a ripple effect that shifted demand pressure to other suppliers.

Importers pricing competition with Dangote

Petrolumeprice.ng reports that a second factor behind the recent scarcity is the withdrawal of private importers, who have found it difficult to compete with Dangote’s pricing.

Many importers now see limited profit margins in bringing in LPG from international markets, especially when domestic producers can offer cheaper alternatives without exposure to foreign exchange or shipping costs.

Dangote refinery sold LPG at N810 per kilogram, while other depots, including Ardova and Nipco, priced the product at N910to N920 per kg, creating a margin of about N100.

Oil and gas expert Olatide Jeremiah, Chief Executive Officer of Petroleumprice.ng, said the three-week break in Dangote’s supply created a market vacuumthat importers failed to fill.

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Jeremiah explained:

“Dangote only resumed selling on Wednesday after being out of the market for about three weeks. Importers also stayed away, claiming it was difficult to compete with Dangote’s lower pricing. This created a supply vacuum. Scarcity always comes with a price hike, and retailers took advantage."

PENGASSAN Strike

The third disruption is said to be from the Petroleum and Natural Gas Senior Staff Association of Nigeria (PENGASSAN) strike, which further tightened supply lines.

The industrial action, which coincided with the refinery’s maintenance period, delayed cargo movements and slowed product trucking from terminals.

The combined effects of halted refinery output, importers’ retreat, and labour disruptions strained LPG flow into the South-West, causing scarcity and hike in prices.

Cooking gas prices

Earlier, Legit.ng reported that the price of cooking gas has hit an all-time high in Nigeria, according to recent data from the National Bureau of Statistics (NBS).

Read also

Cooking gas Hits ₦17,500 as strike, Dangote supply delay triggers fresh price surge

The NBS Price Watch report shows that the average price of refilling cooking gas has surged to the highest since the start of the year.

Source: Legit.ng