Aviation fuel scarcity bites harder, as price hits N607 per litre

Oredola Adeola

… passengers stranded due to flight cancellation, delay

Scarcity and rising price of Aviation fuel, also known as Jet A1, across the various airports in the country is about leading to complete shut down of operations of domestic flights in Nigeria.

Major Airlines operating in the country have therefore raised alarm, warning that if the situation is not urgently addressed by the Nigerian Civil Aviation Authority (NCAA) and the marketers of Jet A1, the incessant flight cancellations being witnessed across the country may linger for a longer time with unintended economic consequence.

As of Wednesday, airlines including Arik, Dana, Ibom Air, Azman, Air Peace have written to their customers informing them of canceled flights, urging them to bear with them while they wait for the authorities to address their concerns. According to the Airline operators, flight disruptions will remain inevitable in the days ahead.

EnergyDay’s findings show that the crisis which has lingered for over a week was caused primarily, by complete dependence on product importation, inefficient regulatory oversight and the effects of Dollar- Naira exchange rates.

Our correspondent who monitored the situation at domestic terminals in Lagos airport gathered thousands of air passengers stranded for cancellation of their flights due to scarcity of JetA1.

The scarcity it was gathered became worse during the week, due to the hike in price of Jet A1 increased from between N415 and N440 as at the end of February to N579 per liter in Lagos, N599 in Abuja, N599 in Port Harcourt and N607 in Kano.

The impact was also much because of the increase in the numbers of new airlines and the purchase of new airplanes. It was evident that over the last one year the number of airplanes rose significantly due to entry of new operators.

Aviation experts told EnergyDay that aviation fuel suppliers and regulators have not measured up in fulfilling their roles to build the needed capacity required to match up with the new demand upsurge.

Ikechi Uko, Chief Consultant at Jedidah Promotions, who is also an aviation expert confirmed that the crisis is as a result of scarcity of Jet A1, adding that aviation fuel is presently between N507 and N600 per litre at different airports across the country.

He said, “If the price hike prevails, Airlines may be forced to continue to delay and cancel flights as it may not make economic sense for them to further hike flight fares to about N60,000 per route. He noted that the N50,000 currently being charged by the airlines is already considered too high by travelers.

He added that aviation fuel is non-existent at some airports, which is why some of the airlines are parked at different airports waiting for Supply.

EnergyDay in a conversation with a member of the Major Marketers Association of Nigeria(MOMAN), who would not want his name in print, gathered that the scarcity is caused by lack of capacity of the aviation fuel marketers and suppliers to meet growing demand.

According to him most of the members of MOMAN are not majorly into importations and distribution of JetA1, adding that only TotalEnergies and MRS are involved with sales of the product.

He further revealed that the two MOMAN members control an insignificant market share of 8 percent, leaving the entire market to independent marketers who lack capacity requirements to meet growing industry demand. He blamed the situation on the country’s reliance on importation and weak foreign exchange rate. He particularly said until Nigeria begins to refine petroleum products locally, rising global price of crude oil would continue to affect the price of fuel.

While Dangote and Port Harcourt Refineries will eventually emerge as primary in-country producers when they both come on-stream over the next 18 months, the costs of the present distress may continue unabated.

 

 

 

REACTIONS FROM AIRLINES

The managements of many of these airlines expressed doubt about the possibility of resuming normal operations soon, claiming that the scarcity coupled with the high prices at which they purchase the fuel are having huge impact on their operations.

The Management of Azman Air stated on Wednesday, “The incessant challenges we have been managing effectively in recent times due to scarcity of JETAI Fuel is tending towards a new height henceforth, as there seems to be no probable solution in sight.

“We, therefore, implore our esteemed passengers to kindly bear with us as Flight disruptions will be inevitable in the coming days.

“We can assure you that adequate plans have been finalized to mitigate the effect of these disruptions on our passengers while we appeal to all the parties involved to resolve the issues soonest. We deeply regret all the inconveniences.”

Also, Dana Air in an apology to its customer on Tuesday, explained: “The aviation fuel crisis is taking a new turn and has continued to affect our operations in the last few weeks.

“While we have made progress with regards to getting major commitments from our partners, we crave the patience and understanding of our esteemed customers.

“We will continue to update and make serious efforts to mitigate the niggling delays occasioned by the current fuel scarcity in the country.

“Once again, we sincerely do apologize to all our guests likely to be affected by the current situation.”
Air Peace, stated that the scarcity has continued to pose serious challenges to its smooth operation, although it has done all that was possible to reduce its effect on its customers in the previous days.

“Air Peace and other Nigerian airlines, have, for a while now, been facing the challenge of jet fuel scarcity. We have pushed so far to minimize the effect of the situation on our esteemed passengers’ travel plans to date.

“But unfortunately, the fuel scarcity is starting to seriously impact our operations as we are likely going to experience flight disruptions today and in the coming days until the situation abates.

“We appeal for the utmost understanding of the flying public and regret possible inconveniences, while we work tirelessly to minimize the impact of the situation,” it stated.

Arik Air, in a similar notice issued on Tuesday to its customers giving reason for delays in their flights, said: “Dear Valued Customer, Nigerian airlines are currently experiencing acute scarcity Of Jet Al, otherwise known as jet fuel, and this situation is having serious impact on our operations.

“The commodity is not readily available across the country and where available, it goes for between N590 and N625 per litre.

“Today, Tuesday, March 8, 2022, we have had to delay almost all Of our flights across the network while a few others have been canceled. There is no certainty as to what the situation will be in the coming days.

“We are appealing to our esteemed customers to please bear with us as we engage the Oil marketers and other stakeholders on ways of resolving the current jet fuel situation.

“We will keep our customers abreast of the situation as it unfolds.”

Ibom Air, another major domestic airline, revealed that full operations have been hindered since Tuesday as a result of the fuel scarcity while noting that efforts are being made by its management, in conjunction with other stakeholders, to address the issue.

It said, “We have encountered a situation today where aviation fuel is scarce and therefore unavailable at almost all our flight destinations. This has significantly impacted our flight schedule today and may do the same tomorrow.

“We sincerely apologize to all our passengers affected by the current situation.

“At this time, we have no indication when the issue will be resolved, however, we are working with our fellow airlines and fuel suppliers to find a solution.

“Our passengers and the public should please be informed. We will give an update once we have further information,” it stated.

It said, “We have encountered a situation today where aviation fuel is scarce and therefore unavailable at almost all our flight destinations. This has significantly impacted our flight schedule today and may do the same tomorrow.

“We sincerely apologize to all our passengers affected by the current situation.

“At this time, we have no indication when the issue will be resolved, however, we are working with our fellow airlines and fuel suppliers to find a solution.

“Our passengers and the public should please be informed. We will give an update once we have further information,” it stated.

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