Recent increase in the price of JET-AI (aviation fuel)from N630.to N710/litre, according to the Airline Operators of Nigeria (AON), may lead to about three Nigerian airlines shutting shop, unless the price hike is reversed.
Allen Onyema, Vice Chairman of the Airline Operators of Nigeria (AON), made this known during the ongoing Federal Airports Authority of Nigeria (FAAN) National Aviation Conference (FNAC) in Abuja.
The event which was aimed at getting stakeholders in the aviation industry to share knowledge, deliberate on it and take actions to implement them, was themed, “Advancing the Frontiers of Possibilities for Safe, Secure and Profitable Air Transport’’.
Onyema blamed the recent hike on the depleting value of the Naira, insisting that some airline operators are likely to shut down operations if the trend continues.
He said, “If the present challenge of aviation fuel was not fully addressed, about three airlines may quit operations due to unbearable cost of operations.
“The fuel crisis is not limited to Nigeria but ours is made worse because of the slump in Naira value against major currencies, especially, the dollars,” he stated.
“This is not the only issue. Since the COVID-19 crisis, most airlines all over the world, including Nigeria have not recovered except those whose countries have injected so much funds to assist them.
“This is nobody’s fault. It just happened. Government has tried its best by giving us this aviation fuel. This aviation fuel can take airlines out, not only in Nigeria but everywhere in the world.
“Some airlines outside Nigeria have closed down because of the effects of rising aviation fuel. If these things are not addressed in Nigeria, it can affect the bottom line of all airlines in Nigeria.
“We have come to realise that there is little or nothing the committee set up can do because this is as a result of foreign exchange and the price of oil all over the world now.
Onyema noted that the fuel marketers will sell based on prevailing market realities. He also said that the cost of aviation fuel has increased globally, but added that Nigeria’s case is worse because of the increase in foreign exchange.
Professor Obiora Okonkwo, Chairman of the United Nigeria Airlines, in a statement on Tuesday also corroborated the statement of AON’s Vice Chairman, insisting that nothing much has changed since the Federal Government intervened into the aviation fuel crisis that almost grounded the sector.
According to him the airline operators are yet to feel the impact of the measures to lessen the impact of high aviation fuel prices on the economy.
He noted that in May, when the operators complained that aviation fuel hike, which reached an all-time high of N700 per litre, the Nigeria National Petroleum Corporation (NNPC) Limited, Central Bank of Nigeria (CBN) intervened and agreed to provide six million litres of aviation fuel at N480 a litre for three months.
Okonkwo noted that the measures aimed at cushioning the effect are yet to be fully implemented.
He said, “We commend the Government for intervention but the truth of the situation is that those initiatives taken are still at the implementation stage, they have not been fully implemented, so we are not feeling the impact yet.