Cooking Gas: Price hike punishes small businesses as Nigerian govt looks away

Aside from the heat in Abuja, Madam Victoria endured an intense, stifling smoke emanating from cooking with firewood, the third greatest killer of women and children in Nigeria, according to the World Health Organization.

It was in early September and I watched her singing Timaya’s “I can’t kill myself oo” as she dismantled her gas burner from the cylinder. “I go pack this cylinder, for now, na firewood sure pass now,” Ms Victoria sang under the canopy where she sells food.

The hike in the prices of cooking gas has forced many women into harmful alternatives such as using firewood and charcoal for cooking.

The spike adds to the profound challenges women and children face in the country.

Before the increase, a 6kg gas cylinder was refilled for N1,800, but it now goes for between N4,200 and N4500.

Up from N1,200, now a 3kg cylinder goes for N2,100, an increment of N900.

Meanwhile, the 12.5kg cylinder increased from N3, 600 to N9000, depending on the vendor. The price has changed at least thrice in the last few months.

Prices differ across the states.

The average price for refilling a 5kg cylinder of cooking gas also increased by 8.23 per cent month-on-month and by 21.42 per cent year-on-year in September, Nigeria’s statistics bureau said.

Likewise, the average price for the refilling of a 12.5kg cylinder for cooking gas increased by 36.55 per cent month-on-month and by 49.97 per cent year-on-year in September.

Despite the health implications and other environmental hazards that come with cooking with firewood and charcoal, Nigerian households and business owners who spoke with PREMIUM TIMES said they cannot quit their businesses or stop cooking for their families.

Ms Victoria, 45, said the steady rise in the price of cooking gas has affected her business negatively, prompting her to switch to firewood as an alternative.

“Firewood is not good for my health. The smoke is affecting my eye badly but what can l do,” lamented Ms Victoria who has been in the food business for seven years.

“There’s no help from anywhere and I need to survive, the small gain that I will manage with my family will I carry it and buy gas?”

Like Ms Victoria, the rise has affected Jane Okoko and her business. “It is very easy to cook with gas,” she said, “but right now I have to struggle with firewood flames since gas is very expensive now.”

“As you can see now, I have started using charcoal to aid my cooking,” she said pointing at her cooking space.

Mrs Okoko said she will only consider the option of going back to using gas when the price goes down.

Data from the International Centre for Energy, Environment, and Development (ICEED) show that 98,000 Nigerians die annually as a result of smoke inhaled while cooking with firewood, with women and children as the most affected persons.

The UN says close to 4 million people die prematurely from illnesses attributable to household air pollution from inefficient cooking practises using polluting stoves paired with solid fuels and kerosene.

Cooking with firewood has several implications for human health, experts said.

In an interview with PREMIUM TIMES, Uchenna Felix, a medical doctor, said long term exposure to burning firewood can lead to asthma, chronic bronchitis, reduced lung function, increased cancer risk, reduced immune function and heart diseases.

“It has adverse effects on the physical development of man,” he said, adding that “wood-burning generates nitrogen oxides and carbon monoxide which are very harmful to human health and the dedication of the ozone layer.”

The new normal of cooking with firewood will temper with the UN climate change policy to back the reduction of emissions from forest degradation and deforestation scheme.

In 2013, the federal government took measures to tackle the problem of deforestation by adopting the National Policy on Climate Change and Response Strategy.

The policy is aimed at making the country resilient to climate change.

Businesses that stick with liquefied petroleum gas, expectedly shift the cost burden to the consumers, adding to the country’s already high cost of goods and services.

“This increase in the price of gas coupled with other costs has forced me to increase the price of smoked catfish to compensate for the incurred cost and get little profits,” said Oyesola Peter, a fish processor in Ibadan, capital of Oyo state.

He said the increase in electricity tariff and fuel price is not making the use of electric heaters encouraging for him.

“The use of gas is now mostly preferred for drying catfish industrially because of its economic and health advantages but right now the product is on the high side,” he added.

Mr Peter urged the federal government to reverse the price of gas to make fish processors like him remain in the business. “This is a major source of livelihood to many Nigerians,” he said.

Back in Abuja, Sunday Udoh a gas dealer said the hike in gas has plummeted his sales.

“Since the increase in gas, I must tell you I’m no longer a happy man, this is because before the sudden price increase, I know how much I make daily but now, only a few people are coming to refill gas,” he said.

Another vendor, Abiodun John, said his sales has also dropped.

“When people come to refill their cylinder and you tell them the price, the majority of them turn back,” he said.

“And I keep telling them that we can not sell beyond what we buy, We bought it at a high rate and that is why we sell at a high rate too.”

Why are gas prices rising?

In the first week of September, the group managing director of Nigerian National Petroleum Corporation (NNPC), Mele Kyari attributed the hike in the price of cooking gas to the challenges in sourcing adequate supply.

“Today, this country is undersupplied with gas. I can tell you that we are having difficulty feeding our network across the country with gas.” he said. “Every day, it is troublesome to deliver gas. Once your supply is weak, it will affect pricing.

“The supply mechanism of our LPG is very weak, that is why we are collaborating extensively to make sure that we are able to extract LPG from our gas resources so that it is made available to the market. Once supply becomes high, the price will be impacted,” Mr Kyari added.

The Nigerian Association of Liquefied Petroleum Gas Marketers (NALPGAM) said the surge in the prices of cooking gas is linked to the federal government’s re-imposition of value-added tax on imported cooking gas.

Bassey Essien, the Executive Secretary of the association, described the hike as “unfortunate.”

He said it is unfortunate that the Federal Inland Revenue Service and the Ministry of Finance had decided to tax a product that had been exempted from Value Added Tax.

No Relief, No Commitment

In November, the federal government said it was difficult for it to bring the price of cooking gas down as the product is not subsidised by the government and its price is determined by international market forces.

The Minister of State for Petroleum Resources, Timipre Sylva, said the government can only adjust aspects of the pricing within its control, without saying when that will happen.

“So the price of cooking gas is not determined by the government or by anybody in the industry. In fact, gas prices are determined internationally,” he said in Abuja.

“And you all are aware that in Europe, today, gas prices have gone up; there was even a crisis in Europe relating to gas prices. So the pricing of gas internationally now also affects the price of gas in the country.

“Apart from that there are some issues around VAT charges on imported gas, and of course, taxes on imported gas, which we are handling.

“But of course, quite frankly, these taxes on imported gas, you must also juxtapose it side by side with the local producers of gas. So if you incentivize the importation too much, then you will also kill the local industry.

“And also, you don’t want to incentivize the local industry at the expense of the imports, because if you incentivize the local industry at the expense of the imports, then you will not have enough gas produced within the country. So these are the issues of balancing that the midstream and downstream regulatory authorities are handling and I want to assure you that we are quite concerned.”

According to him, President Buhari is also very concerned and aware that the price of gas is high in the market, and “we’re doing everything trying to see how we can bring down the price of gas especially as we approach the yuletide”.

Asked whether the government will address the situation soon as the yuletide season approaches, the minister insisted that there is little the government can do.

“Well, as I said, this is a commodity, whose price is not determined by us. If you tell us, for example, that crude oil prices are high, there’s nothing we can do about it because crude oil prices are not determined in Nigeria.

“We also, like you, check for what the price of crude oil is for today because it is not determined here. In the same vein, when we see gas prices going up, gas prices are not also determined in Nigeria, just like you, we are also checking what the price of gas is in the international market. But of course, there are some elements of the pricing that we can tinker with.

“And I can assure you that we are doing everything to ensure that those elements’ pricing will be adjusted on our side so that at least it will amount to some reduction. But I will not give you a time or date when that will be achieved. We know that the Yuletide is already upon us but we will see how we can at least make it bearable for Nigerians before then.”