Dangote Refinery Cuts Aviation Fuel Price to N1,650, but Airlines Still Pay N2,000 Per Litre

The Dangote Refinery and Petrochemicals has reduced the ex-depot price of aviation fuel to N1,650 per litre. But checks across major cities show that retail prices remain close to N2,000 per litre. Airlines and operators say the high cost of Jet A1 is still hurting flight operations, forcing some carriers to cut flight frequencies.

Price cut not reaching airlines

The refinery announced the reduction from N1,750 to N1,650 per litre. It also introduced a 30-day interest-free credit arrangement for marketers and airlines, backed by bank guarantees. In addition, the company shifted from dollar-based pricing to naira-denominated transactions to reduce exchange rate pressure. However, market surveys show that these changes have not reached the retail level.

In Abuja and Kano, Jet A1 is still selling at about N2,000 per litre. In Lagos, prices range between N1,910 and N1,925 per litre. One fuel marketer reportedly told an airline customer of another upward review, citing persistent volatility in petroleum product costs, rising ex-depot prices, and increasing logistics expenses.

Why prices remain high

Industry experts blame the continued high prices on several factors. Marketers are still selling old fuel stock bought at higher prices before the latest adjustment. Logistics costs, foreign exchange instability, taxes, storage charges, and aviation-specific regulatory fees also push up the retail price.

Fuel marketers handling Jet A1 also pay additional charges to aviation agencies such as the Nigerian Civil Aviation Authority and the Federal Airports Authority of Nigeria. These costs are passed on to airlines.

Global developments have worsened the situation. Ongoing tensions involving the United States, Israel, and Iran, alongside disruptions around the Strait of Hormuz, a major global oil shipping route, continue to affect international fuel supply and pricing.

Airlines struggling

Nigeria’s aviation sector has battled soaring fuel costs for months. Earlier this year, some domestic airlines reduced flight frequencies as fuel prices climbed beyond N2,500 per litre. The Airline Operators of Nigeria had threatened to suspend operations before government intervention led to discussions with fuel marketers. But operators say little progress has been made, with many airlines still cutting flights to manage expenses.

Analysts warn that unless costs ease soon, airlines may be forced to further reduce routes, cancel flights, or increase ticket prices for passengers.

Senate steps in

The Senate has invited the Minister of Aviation and Aerospace Development, Festus Keyamo, alongside key aviation agencies and airline operators, to an emergency meeting over the sharp rise in domestic airfares. Lawmakers said the current pricing trends are unacceptable and risk putting air travel out of reach for many Nigerians. According to the Senate, fares on routes such as Abuja–Lagos, Abuja–Enugu, and Abuja–Ilorin have climbed to between N400,000 and N650,000.