Prices on domestic markets for LPG fluctuated at a decreasing rate and international market for LPG relatively increased in the immediately preceding week  

• The international prices of LPG sloped upward after a fall in the beginning of the week.
• Depot prices have shown some level of depreciation compared to the previous week.
• The market gaps between prices at the depot and those at the international level are narrowing consistently.
• In the week under review and the previous two weeks, price variations in LPG per kg remained within a narrow range.
• Within the region, regional variations in LPG retail prices continue to exist.    

 

The regional variation in LPG prices across Nigeria has been a recurring feature of the Nigerian LPG industry. The South West area has the lowest rates due to its closeness to the coastal region.    

• Inflation Rate and the LPG: The rate of inflation has been gradually rising over the last ten months. It increased from 16.47 in January 2021 to 17.33 in February 2021. (Fig D). From 14.89 in November to 15.75 in December of the following year. The composite food index increased to 21.79 percent in February 2021, 20.57 percent in January 2021, 19.56 percent in December 2020, and 15.48 percent in July 2020, up from 15.18 percent in June 2020. For the month of March, the expected inflation rate is 14.37 percent. Covid-19's aftereffects, as well as border policies that target vital commodities, are all contributing to the upward trend.

 

• Exchange Rate and the LPG: Despite widening discrepancies in the parallel market, the Central Bank of Nigeria's (CBN) pegged exchange rate (Figure E) has remained steady at N380 to US$1 throughout the week. One of the factors that influences the price of LPG on the international market is the exchange rate. Since more LPG is imported, a lower exchange rate has little impact on the selling price of LPG on the local market.

 

• Crude oil Price and the LPG: The price of LPG is positively related to the price of crude oil since it is a by-product of crude oil. The Prices of crude oil in the international market were on appreciated value in the preceding week but ended up fallin (Figure F). The cost of LPG increases as the price of crude oil rises on the international market. This suggests a strong LPG market price.

 

• Foreign Reserves: The Nigerian Gross Foreign Reserve fell from $35.15 billion to $34.94 billion last week, owing to fluctuating oil prices and the peg of the Naira at N380 to US$1. This will send a message to investors and creditors about the naira's strength and capacity to repay debt.

 

• PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.        
  • Covid-19: Covid-19 causes demand of goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts the LPG market  
  • Ramadan Period: Muslims all over the world are in the last 10-days of the one-month fasting period. The rate of cooking among them still persisted in the preceding week. For the last 10-days, they will be careful to avoid disappointment from unreliable cooking energy. Muslims in Nigerians were observed filling their gas cylinders in order to have access to fast cooking energy. It is anticipated that demand for cooking gas will remain the same till the Id el-Fitri.  
    • Reducing the effect of the Covid-19, entails more campaign and public awareness of the virus as people are easily carried away and relaxing. Vaccines for Covid-19 should be distributed without much delay if available.
    • Nigerians are advised to take the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India to be immune against the virus.     The prices in the weeks to come may rise due to increase in in the price of goods and services

 

In the immediately preceding week, prices in the foreign market were on a risen note after an initial decrease and domestic markets for LPG fluctuated during the week

• There was an initial drop in the international prices of LPG at the beginning of the week, it then kept rising till the end of the week but ended on a fallen note.
• Depot prices fluctuated during the week compared to the previous week.
• The narrowing of price disparities between prices at the depot level and those at the international level has remained stable, despite a relatively higher price in the foreign markets.
• In the week under review, the price increased per kg of LPG and has been within the stable ranges with in the last few weeks.
• Disparities in LPG retail prices throughout the country still persist due to transportation cost and closeness to the coastal region.       A daily feature of the Nigerian LPG market was regional variance in LPG prices across the country. Because of the distance from coastal areas the South-East region has the highest price.    
  • Inflation Rate and the LPG: Over the last 13 months, the rate of inflation has been steadily increasing. Inflation rose from 16.47 percent in January 2021 to 17.33 percent in February 2021. (Fig D). From 14.89 in November to 15.75 in December of the following year. The composite food index increased to 21.79 percent in February 2021, up from 20.57 percent in January 2021, 19.56 percent in December 2020, and 15.48 percent in July 2020, up from 15.18 percent in June 2020. The outbreak of the Covid-19 pandemic, as well as Nigerian land border policies against essential goods, are leading to the rising trend. As a result, the monetary value of goods and services is reduced by inflation. If the price of LPG rises, so does the number of people who buy it.
   
  • Exchange Rate and the LPG: The exchange rate remained at N380 to $1 for the entire week due to the continued growth of inequalities in the parallel market. The exchange rate is one of the factors that influences LPG prices on the international market. A higher exchange rate would boost the price of LPG on the local market by a considerable amount. This means that the LPG market is in a state of flux Figure E.
   
  • Crude oil Price and the LPG: The relatioship between LPG price and crude oil price remains positive, as a by-product of crude oil. Crude oil prices reached its lowest points at the middle of the week but showed some appreciation towards the end of week (Figure F). This shows that the price of crude oil has not been stable in the international market and that the price of LPG fluctuated. This reflects variability in the market price for LPG
   
  • Foreign Reserves: As in the previous week, the Nigerian Gross Foreign Reserve showed some level of depreciation from $35.19 billion to $35.15 billion amid the fluctuation in the price of oil and pegging of the Naira at N380 to US$1. This will signal to the investors and country's creditors the strength of naira and ability to repay debt.
   
  • PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.  
    • Covid-19: The effect of Covid-19 still persist as not all Federal Schools have fully resumed while the State universities are taken caution to prevent the spread of the virus. The implications of this on the LPG market is that its volume of sales will not increase in the areas where schools are not yet resumed.
    • Ramadan Period: Fasting still persisted among the Muslims all over the world in the preceding week. The rate of cooking at home increases during the period and many households who are Muslims are already prepared to avoid disappointment from unreliable cooking energy. Muslims in Nigerians were observed filling their gas cylinders in order to have access to fast cooking energy. This fasting will last for a period of one month, and it is anticipated that demand for cooking gas will increase during the period.      
      • Reducing the effect of the Covid-19, entails more campaign and public awareness of the virus as people are easily carried away and relaxing. Vaccines for Covid-19 should be distributed without much delay if available.
      • Nigerians are advised to take the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India to be immune against the virus.     The prices in the weeks to come may rise due to the effect of increase in the rate of inflation.
       
    
    
    The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328
   

 

In the immediately preceding week, prices on domestic showed some levels of depreciation while the international markets for LPG fluctuated at decreasing rate in the same week

• The international prices of LPG fluctuated throughout the week but ended on a risen note.
• Depot prices continuously dropping till the end of the week compared to the previous week.
• The narrowing disparities between prices at the depot level and those at the international level still persists.
• Price changes per kg of LPG in the week under review and in the past few weeks have remained within the limited range.
• Regional disparities in the retail prices of LPG within the country continue to persist.       Regional disparity in the prices of LPG across the country has been a regular feature of the Nigerian LPG market. There is wide gap between the South East and South-west prices, this is due to its distance from the coastal region, has the highest prices due to distance from the coastal regions.    
  • Inflation Rate and the LPG: There has been a continuous rise in the rate of inflation in the past 13 months. The rate of inflation in January 2021 increased from 16.47 to 17.33 in February 2021 (Fig D). From 14.89 in November, to 15.75 in December 2020. The composite food index rose to 21.79 in February 2021, 20.57 in January 2021, 19.56 in December 2020, 15.48 percent in July 2020 compared to 15.18 percent in June 2020. The anticipate inflation rate for the month of Macrch is 14.37%. The post effect of Covid-19 and border policies against essential goods, are contributing to the growing trend.
   
  • Exchange Rate and the LPG: Exchange rate value from the CBN official site still persistent at N380 to US.$1 throughout the week (Figure E), even as disparities continue to widen in the parallel market. The exchange rate is one of the variables that determine the price of LPG in the international market. A higher exchange rate will add to the cost price of the LPG. This reduces LPG in the market.
   
  • Crude oil Price and the LPG: As a by-product of crude oil, the relationship between the LPG price and crude oil price is positive. The Prices of crude oil in the international market were on a risen note throughout the week. (Figure F). This indicates that an increase in the price of crude oil in the international market results in an increase in the cost of LPG. This signal a high price to the LPG market.
   
  • Foreign Reserves: As in the previous week, the Nigerian Gross Foreign Reserve increased from $35.03 billion to $35.19 billion amid the devaluation and pegging of the Naira at N380 to US$1. This will signal to the investors and country's creditors the strength of naira and ability to repay debt.
   
  • PMI: The Purchasing Managers Index (PMI) of the CBN recorded overall growth in jobs, business activities, and inventory in the gas sector in December, while orders remained stagnant in the Electricity, gas, steam & air conditioning supply segment, while Business Activities and employment & inventory remained 45.7 percent in the same month.  
    • Covid-19: The effect of Covid-19 still persist as not all Federal Schools have fully resumed while the State universities are taken caution to prevent the spread of the virus. The implications of this on the LPG market is that its volume of sales will not increase in the areas where schools are not yet resumed.
    • Ramadan Period: Muslims all over the world are currently observing fasting as ordained in the Holy Quran by God. The rate of cooking at home increases during the period and many households who are Muslims are already prepared to avoid disappointment from unreliable cooking energy. Muslims in Nigeria were observed filling their gas cylinders in order to have access to fast cooking energy. This fasting will last for a period of one month, and it is anticipated that demand for cooking gas will increase during the period.  
      • To reduce the effect of the Covid-19 on the economy, there should be a constant awareness programme through the media and places of worship; and also vaccine for Covid-19 should be made available for everybody

    
     

     

    The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

 

Prices on domestic markets and international market for LPG were relatively reduced in the immediately preceding week

• The international prices of LPG sloped downward throughout the week.
• Depot prices have shown some depreciation compared to the previous week.
• The narrowing of the price disparities between prices at the level of the depot and those at the international level is consistent.
• In the week under review and the previous two weeks, price variations in LPG per kg remained within a narrow range.
• Within the region, regional variations in LPG retail prices continue to exist.     A frequent feature of the Nigerian LPG market has been the regional variance in the price of LPG across the country. Due to its close proximity to the coastal region, the South West region has the lowest rates.        
  • Inflation Rate and the LPG: Over the last 10 months, the rate of inflation has been steadily increasing. In January 2021, it increased from 16.47 to 17.33 in February 2021 (Fig D). From 14.89 in November to 15.75 in December 2020. The composite food index rose to 21.79 in February 2021, 20.57 in January 2021, 19.56 in December 2020, 15.48 per cent in July 2020 compared to 15.18 per cent in June 2020. The anticipated inflation rate for the month of March is 14.37%. The post effect of Covid-19 and border policies against essential goods are contributing to the growing trend.
   
  • Exchange Rate and the LPG: The Central Bank of Nigeria's (CBN) pegged exchange rate (Figure E) has remained stable at N380 to US$1 throughout the week, despite widening disparities in the parallel market. The exchange rate is one of the factors that determine the price of LPG in the international market. A lower exchange rate does not lift the selling price of LPG on the local market since more LPG is imported.
   
  • Crude oil Price and the LPG: The price of LPG is positively related to the price of crude oil since it is a by-product of crude oil. The Prices of crude oil in the international market were on appreciated value in the preceding week but ended up falling in the week (Figure F). The cost of LPG increases as the price of crude oil rises on the international market. This suggests a strong LPG market price.
   
  • Foreign Reserves: As in the previous week, despite the devaluation and pegging of the Naira at N380 to US$1, the Nigerian gross Foreign Reserve continues to show some appreciation from $34.84 billion to $34.97 billion. This signals to the forex market that Naira is gaining some strength against the dollar
   
  • PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.          
    • Covid-19: Nigeria is presently experiencing a second wave of the Covid-19 pandemic. This has made some state government in to ban a gathering of people that is more than 20. Covid-19 causes demand of goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts the LPG market  
      • Reducing the effect of the Covid-19, entails more campaign and public awareness of the virus as people are easily carried away and relaxing. Vaccines for Covid-19 should be distributed without much delay if available.
      • Nigerians are advised to take the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India to be immune against the virus.
         

    The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

   

 

In the immediately preceding week, prices in the foreign market and domestic markets for LPG were relatively stable  

• The international prices of LPG increase up to the middle of the week but ended on a fallen note.
• Depot prices were relatively stable during the week compared to the previous week.
• The narrowing of price disparities between prices at the depot level and those at the international level has remained stable, despite a relatively higher price in local markets.
• In the week under review, the price increased per kg of LPG and has been within the specific ranges with an increasing rate in the last few weeks.
• Disparities in LPG retail prices throughout the country still persist due to transportation cost.

 

A daily feature of the Nigerian LPG market was regional variance in LPG prices across the country. Because of the distance from coastal areas the South-East region has the highest price.

 

 

• Inflation Rate and the LPG: Over the last 13 months, the rate of inflation has been steadily increasing. Inflation rose from 16.47 percent in January 2021 to 17.33 percent in February 2021. (Fig D). From 14.89 in November to 15.75 in December of the following year. The composite food index increased to 21.79 percent in February 2021, up from 20.57 percent in January 2021, 19.56 percent in December 2020, and 15.48 percent in July 2020, up from 15.18 percent in June 2020. The outbreak of the Covid-19 pandemic, as well as Nigerian land border policies against essential goods, are leading to the rising trend. As a result, the monetary value of goods and services is reduced by inflation. If the price of LPG rises, so does the number of people who buy it.

 

• Exchange Rate and the LPG: The exchange rate remained at N380 to $1 for the entire week due to the continued growth of inequalities in the parallel market. The exchange rate is one of the factors that influences LPG prices on the international market. A higher exchange rate would boost the price of LPG on the local market by a considerable amount. This means that the LPG market is in a state of flux Figure E.

 

• Crude oil Price and the LPG: The correlation between LPG price and crude oil price remains positive, as a by-product of crude oil. Crude oil prices reached its lowest points at the middle of the week but showed some appreciation towards the end of week (Figure F). This shows that the price of crude oil has not been stable in the international market and that the price of LPG fluctuated. This reflects variability in the market price for LPG

 

• Foreign Reserves: As in the previous week, the Nigerian Gross Foreign Reserve showed some level of appreciation from $34.62 billion to $34.79 billion amid the fluctuation in the price of oil and pegging of the Naira at N380 to US$1. This will signal to the investors and country's creditors the strength of naira and ability to repay debt.

 

• PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.         Covid-19: Nigerians are still seen observing caution not to spread the virus in its second wave period even though there is no lockdown measure applied in the country at present. Economic activities are normal and social distance is maintained. Covid-19 causes demand of goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts the LPG market.  
  • Reducing the effect of the Covid-19, entails more campaign and public awareness of the virus as people are easily carried away and relaxing. Vaccines for Covid-19 should be distributed without much delay if available.
  • Nigerians are advised to take the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India to be immune against the virus.    

 

 

In the immediately preceding week, prices on domestic and international markets for LPG showed some levels of depreciation.

• The international prices of LPG fluctuated throughout the week but ended on a risen note.
• Depot prices were relatively stable from the beginning of the week till the end of the week compared to the previous week.
• The narrowing disparities between prices at the depot level and those at the international level still prevail.
• Price changes per kg of LPG in the week under review and in the past few weeks have remained within the limited range.
• Regional disparities in the retail prices of LPG within the country continue to persist.    

Regional disparity in the prices of LPG across the country has been a regular feature of the Nigerian LPG market. Even though the North Central is far from the coastal region, there is slight difference between the North-central and South-west prices region has the relative highest prices due to distance from the coastal regions.

 

 

• Inflation Rate and the LPG: There has been a continuous rise in the rate of inflation in the past 13 months. The rate of inflation in January 2021 increased from 16.47 to 17.33 in February 2021 (Fig D). From 14.89 in November, to 15.75 in December 2020. The composite food index rose to 21.79 in February 2021, 20.57 in January 2021, 19.56 in December 2020, 15.48 percent in July 2020 compared to 15.18 percent in June 2020. One of the causes of the growing trend is the Nigerian land borders policies against vital products, the outbreak of the Covid-19 pandemic. This implies that inflation erodes the monetary value of goods and services. The price becomes dearer and this reduces sales of LPG.  
• Exchange Rate and the LPG: Exchange rate value from the CBN official site still persistent at N380 to US.$1 throughout the week (Figure E), even as disparities continue to widen in the parallel market. The exchange rate is one of the variables that determine the price of LPG in the international market. A higher exchange rate will add to the cost price of the LPG. This reduces LPG in the market.  
• Crude oil Price and the LPG: As a by-product of crude oil, the relationship between the LPG price and crude oil price is positive. The Prices of crude oil in the international market experienced an initial fall at the beginning of the week but increased for the rest of the week. (Figure F). This indicates that an increase in the price of crude oil in the international market results in an increase in the cost of LPG. This signal a high price to the LPG market.  
• Foreign Reserves: As in the previous week, the Nigerian Gross Foreign Reserve showed some level of appreciation from $34.44 billion to $34.62 billion amid the devaluation and pegging of the Naira at N380 to US$1. This will signal to the investors and country's creditors the strength of naira and ability to repay debt.

 

• PMI: The Purchasing Managers Index (PMI) of the CBN recorded overall growth in jobs, business activities, and inventory in the gas sector in December, while orders remained stagnant in the Electricity, gas, steam & air conditioning supply segment, while Business Activities and employment & inventory remained 45.7 percent in the same month.           Covid-19: Nigeria is currently experiencing the second wave of the Covid-19 pandemic. Federal Schools have not fully resumed while the State universities are taken caution to prevent the spread of the virus. The implications of this on the LPG market is that its volume of sales will not increase in the areas where schools are not yet resumed.   To reduce the effect of the Covid-19 on the economy, there should be a constant awareness programme through the media and places of worship; and also vaccine for Covid-19 should be made available for everybody     The prices in the weeks to come may rise due to the persistent increase in the rate of inflation and rise in the price of crude oil       The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

 

Prices on domestic markets and international market for LPG were relatively reduced in the immediately preceding week

• The international prices of LPG sloped downward throughout the week.
• Depot prices have shown some depreciation compared to the previous week.
• The narrowing of the price disparities between prices at the level of the depot and those at the international level is consistent.
• In the week under review and the previous two weeks, price variations in LPG per kg remained within a narrow range.
• Within the region, regional variations in LPG retail prices continue to exist.

 

A frequent feature of the Nigerian LPG market has been the regional variance in the price of LPG across the country. Due to its close proximity to the coastal region, the South West region has the lowest rates.

 

•  
• Inflation Rate and the LPG: Over the last 11 months, the rate of inflation has been steadily increasing. In December, the rate of inflation increased to 15.75 percent from 14.89 percent in November 2020, and the expected rate of inflation in January 2021 is 14.96 percent (Fig D). The composite food index increased to 19.56 percent in December from 18.3 percent in November, 17.38 percent in October, 16.16 percent in September, and 16.0 percent in August, and to 15.48 percent in July 2020 from 15.18 percent in June 2020. The killing and kidnapping of farmers and businessmen, as well as the outbreak of the Covid-19 pandemic, are some causes of the rising trend. The implication is that inflation depreciates the value of naira. This reduces purchasing power of money used to buy LPG.

 

• Exchange Rate and the LPG: Exchange value, as pegged by the Central Bank of Nigeria (CBN) (Figure E), is still persistent at N380 to US$1 throughout the week as discrepancies continue to expand in the parallel market. One of the factors deciding the price of LPG in the foreign market is the exchange rate. As greater amounts of LPG are imported, a lower exchange rate would not raise the selling price of LPG on the local market. This means the LPG sector is growing.

 

• Crude oil Price and the LPG: The price of LPG is positively related to the price of crude oil since it is a by-product of crude oil. The Prices of crude oil in the international market continue to fluctuate in the preceeding week but showing some appreciation at the end of the week (Figure F). The cost of LPG increases as the price of crude oil rises on the international market. This suggests a strong LPG market price.

 

• Foreign Reserves: As in the previous week, despite the devaluation and pegging of the Naira at N380 to US$1, the Nigerian gross Foreign Reserve continues to fall from $34.66 billion to $34.44 billion. This will signal to the forex market that there is imminent further devaluation to assist support the naira.

 

• PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.        
  • Covid-19: Nigeria is presently experiencing a second wave of the Covid-19 pandemic. This has made some state government in to ban a gathering of people that is more than 20. Covid-19 causes demand of goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts the LPG market
  • Covid-19 Vaccine arrived in Nigeria: Nigerian President Muhammad Buhari on Saturday urged all "eligible Nigerians" to be vaccinated against coronavirus as soon as possible using the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India and provided through the global COVAX initiative. The implication of this is that people will be confident health-wise and this will lead to free flow of activities in the economy without full or partial lockdown.  
    • Reducing the effect of the Covid-19, entails more campaign and public awareness of the virus as people are easily carried away and relaxing. Vaccines for Covid-19 should be distributed without much delay if available.
    • Nigerians are advised to take the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India to be immune against the virus.  
      • The prices in the weeks to come may rise due to increase in in the price of goods and services    

        The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

   

 

In the immediately preceding week, prices in the foreign market and domestic markets for LPG were relatively stable

 

• The international prices of LPG was on a risen note after an initial fall in the beginning of the week.
• Depot prices fluctuated with a slight increase at the end of the week compared to the previous week.
• The narrowing of price disparities between prices at the depot level and those at the international level has remained narrowed, despite relative fluctuation in both markets.
• In the week under review, the price increased per kg of LPG and has been within the specific ranges with an increasing rate in the last few weeks.
• Disparities in LPG retail prices throughout the country still persist due to transportation cost.       A daily feature of the Nigerian LPG market was regional variance in LPG prices across the country. Because of the distance from coastal areas the South-East region has the highest price.  
  • Inflation Rate and the LPG: In the last 11 months, inflation has been steadily rising (Fig D). The rate of inflation in November increased from 14.89 to 15.75 in December 2020 (Fig D). The composite food index inclined to 19.56 in December from 18.3 in November and 17.38 in October, 16.16 percent in September and 16.0 percent in August, 15.48 percent in July 2020 compared to 15.18 percent in June 2020. This is caused by the lasting effect of the closure of Nigerian land borders against vital products, the outbreak of the Covid-19 pandemic and the kidnapping and killing of farmers in the agrarian part of the country. The expected rate of inflation in January 2021 is 14.96%. Goods and services are now competing against fixed, and even declining, revenue from consumers. The LPG market declined as a result.
   
  • Exchange Rate and the LPG: Due to the continued development of disparities in the parallel market, the exchange value continued at N380 to US $1 throughout the whole week (figure E). The exchange rate is one of the variables which in the international market determines the prices of LPG. A higher exchange rate would add a significant amount to the purchase price of the LPG on the local market. This implies that the LPG market contracts.
   
  • Crude oil Price and the LPG: The correlation between LPG price and crude oil price remains positive, as a by-product of crude oil. Crude oil prices reached its apex towards the end of the week but ended on fallen note in international market (Figure F). This shows that the price of crude oil has not been stable in the international market and that the price of LPG fluctuated. This reflects variability in the market price for LPG
   
  • Foreign Reserves: As in the previous week, despite Naira devaluation and the pegged exchange rate at N380 to US$ 1, the Nigerian Foreign Reserve decrease further from $34.90 billion to $34.66 billion in the week under review despite the devaluation and pegging of the Naira at N380 to US$ 1. This might be due to instability in the price of oil.
   
  • PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.       Covid-19: Nigerians are still seen observing caution not to spread the virus in its second wave period even though there is no lockdown measure applied in the country at present. Economic activities are normal and social distance is maintained. Covid-19 causes demand of goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts the LPG market Covid-19 Vaccine arrived in Nigeria: Nigerian President Muhammad Buhari on Saturday urged all "eligible Nigerians" to be vaccinated against coronavirus as soon as possible using the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India and provided through the global COVAX initiative. The implication of this is that people will be confident health-wise and this will lead to free flow of activities in the economy without full or partial lockdown.  
    • Reducing the effect of the Covid-19, entails more campaign and public awareness of the virus as people are easily carried away and relaxing. Vaccines for Covid-19 should be distributed without much delay if available.
    • Nigerians are advised to take the AstraZeneca COVID-19 vaccine, manufactured by the Serum Institute of India to be immune against the virus.  

      The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

 

In the immediately preceding week, prices on domestic markets for LPG were relatively stable while the international market price was on a fallen note.

• The international prices of LPG reached its peak in the middle of the week and started falling thereafter.
• Depot prices were relatively stable from the beginning of the week till the end of the week compared to the previous week.
• The narrowing disparities between prices at the depot level and those at the international level still prevail.
• Price changes per kg of LPG in the week under review and in the past few weeks have remained within the limited range.
• Regional disparities in the retail prices of LPG within the country continue to persist.       Regional disparity in the prices of LPG across the country has been a regular feature of the Nigerian LPG market. Even though the North Central is far from the coastal region, there is slight difference between the North-central and South-west prices region has the relative highest prices due to distance from the coastal regions.    
  
  • Inflation Rate and the LPG: There has been a continuous rise in the rate of inflation in the past 13 months. The rate of inflation in November increased from 14.89 to 15.75 in December 2020 (Fig D). From 18.3 in November, 17.38 in October, 16.16 percent in September and 16.0 percent in August, the composite food index rose to 19.56 in December, 15.48 percent in July 2020 compared to 15.18 percent in June 2020. One of the causes of the growing trend is the closure of Nigerian land borders against vital products, the outbreak of the Covid-19 pandemic and the protest against EndSars. This implies that inflation erodes the monetary value of goods and services. The price becomes dearer and this reduces sales of LPG.
   
  • Exchange Rate and the LPG: Exchange rate value from the CBN official site still persistent at N380 to US.$1 throughout the week (Figure E), even as disparities continue to widen in the parallel market. The exchange rate is one of the variables that determine the price of LPG in the international market. A higher exchange rate will add to the cost price of the LPG. This reduces LPG in the market.
   
  • Crude oil Price and the LPG: As a by-product of crude oil, the relationship between the LPG price and crude oil price is positive. The Prices of crude oil in the international market experienced an initial fall at the begining of the week but increased for the rest of the week. (Figure F). This indicates that an increase in the price of crude oil in the international market results to an increase in the cost of LPG. This signal a high price to the LPG market.
   
  • Foreign Reserves: As in the previous week, the Nigerian Gross Foreign Reserve continues to decline, moving from $35.2 billion to $34.90 billion amid the devaluation and pegging of the Naira at N380 to US$1. This will signal to the forex market that further devaluation is inevitable in order to help support the naira.
   
  • PMI: The Purchasing Managers Index (PMI) of the CBN recorded overall growth in jobs, business activities, and inventory in the gas sector in December, while orders remained stagnant in the Electricity, gas, steam & air conditioning supply segment, while Business Activities and employment & inventory remained 45.7 percent in the same month.
          Covid-19: Nigeria is currently experiencing the second wave of the Covid-19 pandemic. Federal Schools have not fully resumed while the State universities are taken caution to prevent the spread of the virus. The implications of this on the LPG market is that its volume of sales will not increase in the areas where schools are not yet resumed.   To reduce the effect of the Covid-19 on the economy, there should be a constant awareness programme through the media and places of worship; and also vaccine for Covid-19 should be made available for everybody   The prices in the weeks to come may rise due to the persistent increase in the rate of inflation and rise in the price of crude oil  

The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328

Prices on domestic markets for LPG were relatively reduced in the immediately preceding week, while it fluctuated in the international market.

 

• The international prices of LPG fluctuated throughout the week but ended on a fallen note.
• Depot prices have shown some depreciation compared to the previous week.
• The narrowing of the price disparities between prices at the level of the depot and those at the international level is consistent.
• In the week under review and the previous two weeks, price variations in LPG per kg remained within a narrow range.
• Within the region, regional variations in LPG retail prices continue to exist.       A frequent feature of the Nigerian LPG market has been the regional variance in the price of LPG across the country. Due to its close proximity to the coastal region, the South West region has the lowest rates.      
  • Inflation Rate and the LPG: Over the last 11 months, the rate of inflation has been steadily increasing. In December, the rate of inflation increased to 15.75 percent from 14.89 percent in November 2020, and the expected rate of inflation in January 2021 is 14.96 percent (Fig D). The composite food index increased to 19.56 percent in December from 18.3 percent in November, 17.38 percent in October, 16.16 percent in September, and 16.0 percent in August, and to 15.48 percent in July 2020 from 15.18 percent in June 2020. The killing and kidnapping of farmers and businessmen, as well as the outbreak of the Covid-19 pandemic, are some causes of the rising trend. The implication is that inflation depreciates the value of naira. This reduces purchasing power of money used to buy LPG.
   
  • Exchange Rate and the LPG: Exchange value, as pegged by the Central Bank of Nigeria (CBN) (Figure E), is still persistent at N380 to US$1 throughout the week as discrepancies continue to expand in the parallel market. One of the factors deciding the price of LPG in the foreign market is the exchange rate. As greater amounts of LPG are imported, a lower exchange rate would not raise the selling price of LPG on the local market. This means the LPG sector is growing.
   
  • Crude oil Price and the LPG: The price of LPG is positively related to the price of crude oil since it is a by-product of crude oil. The Prices of crude oil in the international market continue to rise in the beginning of the week under review before it started falling towards the end of the week. (Figure F). The cost of LPG increases as the price of crude oil rises on the international market. This suggests a strong LPG market price.
   
  • Foreign Reserves: As in the previous week, despite the devaluation and pegging of the Naira at N380 to US$1, the Nigerian gross Foreign Reserve continues to fall from $35.5 billion to $35.2 billion. This will signal to the forex market that there is imminent further devaluation to assist support the naira.
   
  • PMI: The CBN Purchasing Managers Index (PMI) recorded overall growth in employment, business and inventory in the month of December while ordering in the category of supply for power, gas, steam and air conditioning remained stagnant while business operation & inventory were static in the same month at 45.7 per cent.

 

 

 

 

• Food Blockage to Southern Nigeria: Foodstuff and livestock traders from the Northern Nigeria have begun to transfer their products and consumables to the neighbouring Nigerian and Cameroon countries. They've also started blocking trade routes to the south by preventing trucks carrying food from heading south. This will cause scarcity of food and rise in food price in the southern Nigeria and demand in the LPG will fall.

 

• Covid-19: Nigeria is presently experiencing a second wave of the Covid-19 pandemic. This has made some state government in to ban a gathering of people that is more than 20. Covid-19 causes demand of goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts the LPG market  
  • In order to avoid scarcity of food in the southern Nigeria, the Federal Government should intervene to unblock the road that leads to the south and secure the life of farmers against the herdsmen in the south. Farming projects should be funded and monitored to increase the volume of food production in the country. This will bring down the prices of the food items. When the food items are cheaper, the household consumption of the LPG will increase.
   
  • To curb the spread of the Covid-19, protective kits and an approved vaccine should be available to all and sundry and establish programs that will keep people aware of the pandemic     The prices in the weeks to come may rise due to increase in in the price of crude oil     The Nigerian LPG Market is the next success story of the Global LPG industry, if you need a partner with a global perspective and local expertise in the Nigerian and African space, kindly book for a free session with our team of experts to help you http://www.kiakiagas.com/book-session or write us an email at advisory@kiakiagas.com or Whatsapp: +2348085269328