Airlines Groan, Fare May Rise As Jet A1 Climbs To N315 Per Litre


Barely three months after the price of Jet A1, otherwise known as aviation fuel, hit N275 per litre from less than N200, the price of the product has once again skyrocketed.

Daily Independent gath­ered that the price of the product has risen to N305 per litre in Lagos, while it goes as high as N315 per litre outside Lagos.

It was gathered that the product is available in Lagos, but its high price has com­pelled airlines to source for more funds to buy the product and has led to flight delays and cancellations in some cases.

There are also strong indi­cations that the airlines may be forced to review upward airfares in the domestic scene any moment from this week, as a source close to one of the carriers said over the week­end that the management was meeting to review the current situation and airfares.

The source also confirmed that the product was not scarce in Lagos, but the same could not be said of airports outside Lagos.

“The product is not really scarce in Lagos, maybe in oth­er states as they have to truck it. So, it’s readily available in Lagos for now, but the cost is on the high side. While we try to be very considerable and make our fares convenient for air travellers, the implication of this high cost of aviation fuel is slight increase in fares.

“We have operational cost and as this increases, we have no option than to slightly ad­just the fares. But for now, I can assure you that our fares are still very competitive when compared to others. We would adjust if the pric­ing continues next week (this week), but slightly because our edge is pricing.”

Already, one-way ticket for an hour flight is between N60,000 and N80,000, depend­ing on the time a traveller booked his/her flight, while most of the seats are “sold out” 48 hours before flight.

Engr. Abednego Galadima, President, National Associa­tion of Aircraft Pilots and Engineers (NAAPE), said that the only way the periodic scar­city or continuous rise in the price of aviation fuel could be solved was for the govern­ment to ensure local refining of the product.

He explained that the asso­ciation in collaboration with the Nigeria Labour Congress (NLC) had always craved for local refining and wondered why this had been difficult for government to do in the past three decades despite the available resources.

He warned that if airfares continue to rise, potential pas­sengers would be driven away from the sector and equally advised local carriers to em­bark on aviation fuel edging to curb impact of the rise in their operations.

He said: “As long as we con­tinue to rely on importation, our industry will continue to suffer and it’s an area I will call on government to look into urgently so that we will not continue to suffer this.”

In a recent interview with Daily Independent, Engr. Femi Adeniji, Chief Executive Offi­cer (CEO), TAL Helicopters, warned against fuel contam­ination once the price is high.

He also called on the Feder­al Government to ensure local refining of the product in or­der to ensure airlines get the product at cheaper rates and make air tickets more afford­able to the travelling public.

On the effect on the flying public, Adeniji noted that the airlines are gradually increas­ing air tickets especially in most major routes.

Mr. Olumide Ohunayo, Di­rector, Research, Zenith Trav­els, lamented that aviation fuel alone consumes about 30 to 40 percent of airline ex­penses.

Ohunayo, however, ex­plained that the sub-sector was deregulated, but noted that in order to cushion the effect of the high price, the Federal Government should repair the Nigerian Nation­al Petroleum Corporation’s (NNPC) underground pipe between Ejigbo and the Lagos airport.

He explained that for the airlines to benefit from the product’s pricing, they either buy in bulk or edge, which, he said, required lump sum.

He observed that passen­gers may bear the brunt as air­lines would further increase airfares, while same passen­gers may witness flight delays and cancellations.

To encourage the operators and reduce fares, Ohunayo also canvassed some tax waiv­ers for operators from govern­ment agencies.

He said: “Aviation fuel is de­regulated in Nigeria. Unfortu­nately, for the industry, 30 to 40 percent operational expenses come from aviation fuel. The only way we can benefit from aviation fuel pricing is if you have a bulk purchase or edg­ing and for you to edge, you must have enough money to edge fuel or you belong to an association whereby it is a pol­icy of the higher the number you buy, the lower the price.

“Airlines in Nigeria don’t have any alliance or involve in any serious organisation or association. So, every airline deals with importer on an in­dividual basis. They bear the brunt of the increase in fuel. Once there is any increase in fuel, the first set of people that get the fire are the passengers; the tickets go up, flight may be delayed because at times, it may not be available and if it is available, suppliers may be demanding for cash because of the cost of the product.”

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