Authorities in Nigeria have taken steps to steady the aviation sector by placing a cap on jet fuel prices and permitting airlines to buy fuel on credit. A government document cited by Reuters indicates the move is aimed at avoiding flight disruptions caused by escalating costs.
The Nigerian Midstream and Downstream Petroleum Regulatory Authority announced that aviation fuel should be priced between 1,760 and 1,988 naira per litre in Lagos, and 1,809 to 2,037 naira per litre in Abuja, based on benchmarks from April 17 to April 23.
However, the regulator cautioned that prices may still shift due to global market instability, including geopolitical tensions such as the U.S.–Iran situation, alongside rising supplier expenses, Reuters reported.
Emergency discussions follow price spike
This intervention comes after urgent meetings between government representatives and industry players, triggered by airline warnings that jet fuel costs had jumped by over 270%, leading to higher ticket fares and fears of reduced flight capacity.
President Bola Tinubu recently approved a 30% concession on airlines’ debts owed to aviation agencies. He also instructed fuel suppliers, carriers, and regulators to settle on a reasonable pricing structure within 72 hours to prevent a shutdown across the industry. As part of the agreement, airlines were given a 30-day window to settle fuel payments, while the aviation ministry was assigned to resolve disputes between operators and fuel marketers.
A technical panel formed by the Nigerian Midstream and Downstream Petroleum Regulatory Authority further advised that marketers supply fuel directly to airlines within the approved pricing range to cut costs and enhance transparency in distribution.
Additionally, regulators were encouraged to open talks with Dangote Petroleum Refinery and Petrochemicals over higher pricing margins linked to global jet fuel benchmarks.
Other suggestions include accrediting airside fuel distributors with adequate infrastructure, which could reduce the number of suppliers operating at airports, and exploring the inclusion of jet fuel in Nigeria’s naira-for-crude policy to ease airlines’ exposure to foreign exchange volatility.