Economist Says Increase In Kerosene And Gas Prices Will Affect Nigerians 

Kerosene and cooking gas costs are expected to continue rising, making it harder for Nigerians to afford basic food and other necessities.

By Omotayo Olutekunbi

This was said in an interview with the News Agency of Nigeria (NAN) on Wednesday in Abuja by Prof. Aminu Usman, an Economics lecturer at the Kaduna State University.

He was responding to the most current home kerosene and cooking gas prices that were made public by the National Bureau of Statistics (NBS) on Monday.

In line with the NBS report, the average retail price for a liter of kerosene increased by 98.76% from N397.34 in July 2021 to N789.75 in July 2022.

According to the study, the product had a 3.68 percent month-over-month rise, rising to N789.75 in July 2022 from N761.69 in June 2022.

The NBS also reported that the cost of replenishing a 5kg of cooking gas climbed by 105.35 percent on an annual basis, from N2,141.59 in July 2021 to N4,397.68 in July 2022.

On a monthly basis, however, it rose by 4.25 percent, from N4,218.38 in June 2022 to N4,397.68 in July 2022.

Usman claimed that given the rising trend in commodity prices in both the Nigerian and global economies, the increase in the price of the goods was to be expected.

He claims that it further supports prior NBS inflation data showing a steady increase in the country’s inflation rate.

” Recall that the bulk of the price increases came through food inflation which was also influenced by the cost of energy used in the food processing for both manufacturers and households.”

According to the NBS, Nigeria’s headline inflation rate rose to 19.64% on an annual basis in July, as reported by NAN.

He claimed that the supply and costs of cooking gas, fuel, and kerosene had all been liberalized and were no longer subject to government subsidies of any kind.

Therefore, the economist said that these items’ pricing accurately represented current market rates, particularly in relation to the prices of crude and refined petroleum products on a global scale.

“Our case is made worse by our inability to refine these products locally and therefore we have to import, which puts much pressure on the value of our local currency as compared with other currencies.

” Therefore, the implication of this is that food will now consume almost all earnings of the common man for life sustainability leaving other basic necessities unattended.

” The inability of the common man to consume other essentials of life means a further contraction of the economy.”

Usman said that this would worsen the already dire circumstances faced by the average person by slowing down the development of production and the creation of jobs.

He claims that the nation, and implicitly the average person, will have to deal with the unpredictability and rising cost of these goods.

“This is pending the time we get our acts together with regards to petroleum products refining and or the resolution of the international crises that pushed crude prices up.”