Nice move
Difficulty being faced by airline operators with the high cost of aviation fuel is receiving attention from the Federal Government. Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele,
- We welcome govt’s intervention in aviation fuel price hike
Difficulty being faced by airline operators with the high cost of aviation fuel is receiving attention from the Federal Government. Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, conferred recently with the Minister of Aviation and Aerospace Development Festus Keyamo to find ways of tackling the high fuel cost and mounting pressure on airline operators.
The operators had, in recent weeks, complained that the huge cost of Jet A1, a core input in their operations, threatened to paralyse flight services and could compel sharp hikes in fares paid by travellers. The ministers’ intervention apparently was aimed at stabilising the sector and protecting passengers from higher fares.
In a post on X, Oyedele said the two ministers had “constructive discussions on the challenges facing the aviation sector, particularly the recent sharp increase in the cost of aviation fuel and its impact on airlines’ operations and pricing.” The meeting, according to him, also focused on opportunities to reposition the sector for growth. He added that government aims at building “a more sustainable, efficient and competitive aviation industry that supports economic activity and connectivity.”
The talks by the ministers followed a government initiative earlier in the week to ease the pressure on domestic airlines by discounting their debt obligations to regulatory agencies. Keyamo announced a 30 percent discount on outstanding debts owed by local carriers to aviation agencies, after a high-level meeting that involved oil marketers, airline operators, regulatory agencies and other stakeholders, amid concerns that rising aviation fuel cost could hamper flight operations. The discount, which Keyamo said had the approval of President Bola Ahmed Tinubu, was aimed at providing immediate financial succour to the operators.
Indigenous airline operators had warned of possible service curtailment or fare hike if the situation persists, raising fears of reduced connectivity.
Sometime last month, the aviators on the platform of Airline Operators of Nigeria (AON) served a notice of imminent withdrawal of flight services unless government intervened in the astronomical hike in aviation fuel cost. According to them, that core input in their operations had risen by some 300 percent.
“Currently, airline revenues are insufficient to cover the cost of fuel alone, which is only one of many operational expenses incurred daily,” the body said in a letter to senior government officials signed by its president, Abdulmunaf Yunusa Sarina. “For avoidance of doubt, this arbitrary increase has already severely impacted one airline, forcing it to ground all operations since March 13, 2026. This may become inevitable for other airlines if the situation does not change immediately,” it added.
The trend has impacted also on airlines’ international operations, with Air Peace lately cutting its Abuja-London flight frequency to three times per week owing to Jet A1 supply constraints. “This measure is necessary to maintain the highest standards of safety and operational reliability during this period, with full operational frequency on our London service scheduled to resume from July 1,” the airline said in a statement. Before the scale-back, Air Peace operated daily flights between Abuja and London.
Aviation fuel marketers ascribed the price surge to global supply disruptions and logistics costs, although they disputed the level of price increase alleged by airline operators. The Major Energies Marketers Association of Nigeria (MEMAN) cited ongoing geopolitical tensions in the Middle East as having severely disrupted global supply chains and impacted pricing and availability of middle distillate products like diesel and Jet A1.
The body, however, questioned the N3,300 price per litre of Jet A1 referenced by the operators, saying an internal survey showed the going market rate among its members to be more than N1,000 less.
“MEMAN members do not discuss pricing, as this will be against competition law. However, the price of N3,300 is over N1,000 higher than our average market survey price of Jet A1 carried out after receipt of your letter,” it said in response to the airline operators’ complaint.
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It was against this backdrop that Dangote Petroleum Refinery, last week, announced it was pegging the gantry price of aviation fuel at N1,820 per litre. The refiner made that disclosure to enhance transparency in the sector, amidst conflicting claims by fuel marketers and airline operators as to what Jet A1 goes for at the pump-head.
By implication, stakeholders can now guess expected price range that the product should attract even after marketers have factored in their add-on costs.
Dangote’s announcement, without doubt, helps to lay open the aviation fuel pricing template and undercut alleged tendencies by marketers to exploit airline operators. But that, by itself, is not sufficient to restrain fuel costs and resulting crushing impact on services in the sector.
There is need for structured intervention by government to keep local prices from running amok at the instance of wild forces of the international market.
Measures already unveiled are in that direction, but they need to be deepened and expanded sustainably to relieve pressure in the local economy. We trust that government is up to the task.
