Marketers have suggested that the high dollar to naira exchange rate is having a negative influence on importation of gas which could lead to a further increase in gas costs and higher prices for Nigerians.
In a conversation with The PUNCH on Sunday, IPMAN's national operations controller, Mike Osatuyi, stated that because independent marketers obtained dollars for importation on the black market, gas prices would keep rising until the naira gained strength on the exchange market.
In addition, he claimed that although some gas vendors still sell gas, they just purchased 20,000 metric tons at a cost of about N11 million; however, as of now, the price has increased to N12.3 million for 20,000 metric tons.
He said that as long as the currency kept improving, petrol consumers would continue to face price increases. Along with the low gas supplies on the global market, which are mostly the result of the conflict between Russia and Ukraine, he added that The PUNCH had also learned that Nigerian Liquefied Natural Gas Ltd., or NLNG, has seen a sharp decline in gas production.
The oil and gas pipeline vandalism and elevated stealing, which had reduced NLNG's potential to 60%, were the main causes of the yield decline, and according channels familiar with the situation. From 20.7 million tonnes in 2020 and 2019, NLNG's six-train Bonny plant's productivity and shipping has decreased to 16.8 million tonnes in 2021.
According to the company's General Manager, Adeleye Falade, who spoke at the 45th Nigeria International Conference and Exhibition 2022, NLNG has reportedly lost about $7 billion in annual revenue so far in 2022 as a result of gas supply restrictions.
Since 2021, biogas exchanges have become more constrained globally. This year, the IEA predicts that international demand for gas will fall by 0.8% as a result of Europe's track 10% compression and the Asia-Pacific region's plain request.
Nigeria's petroleum and natural gas industry has recently been afflicted by chronic underfunding and the ongoing issue of oil theft from pipelines. Major oil corporations have backed away from investing in Nigerian supply, and several foreign companies may have sold assets or announced plans to sell them off..