Nigerians hoping for relief from soaring cooking gas prices may face disappointment, as experts caution that the recent Liquefied Petroleum Gas (LPG) export ban may not immediately lead to significant price reductions.

The federal government’s decision, effective November 1, 2024, was intended to stabilise prices by increasing local LPG availability. Producers, including the Nigerian National Petroleum Company Limited (NNPCL), are required to redirect exports to the domestic market or import equivalent volumes at cost-reflective prices. However, systemic challenges continue to hinder the market.

Lanre Bayewu, Executive Secretary of the Nigerian Liquefied and Compressed Gases Association, explained that factors such as dollar-denominated production costs, a weak naira, high inflation, and insufficient infrastructure are still driving up prices. These systemic issues outweigh the impact of the export ban, he noted.

The Nigeria Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) plans to develop a new pricing framework within 90 days to reduce reliance on international market indices. Meanwhile, the Minister of State for Petroleum Resources (Gas), Ekperikpe Ekpo, has announced measures to increase domestic blending, storage, and delivery infrastructure within the next year.

While these steps aim to address supply bottlenecks, experts argue that addressing broader challenges—such as licensing fees paid in foreign currency, inadequate transportation facilities, and limited investment in local energy production—will be critical for long-term price stability.

The LPG market has seen rapid growth in recent years but has been plagued by stagnation due to rising costs. According to the National Bureau of Statistics, cooking gas prices have surged by 80% between January and September 2024, further burdening Nigerian households.

Although exemptions from value-added tax and plans to adapt the Escravos LPG mix for local consumption offer some hope, industry stakeholders stress the need for sustained political will and consistent implementation to deliver tangible relief to consumers.

For now, the export ban represents a step in the right direction, but much remains to be done to achieve price stability in Nigeria’s LPG market.