WEEK 78: LPG Insider Report
In the immediately preceding week, prices in the foreign market fluctuated after reaching their peak in the beginning of the week while domestic prices for LPG also fluctuated at an increasing rate
- The international prices of LPG fluctuated throughout the week. but ended at an increasing rate.
- Depot prices were not stable throughout the week compared to the previous week.
- Despite a somewhat higher price in foreign markets, the shrinking of price gaps between prices at the depot level and those at the international level has remained consistent.
- 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.
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Due to transportation costs and proximity to the coast, disparities in LPG retail pricing still exist across the country.
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.
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- Inflation Rate and the LPG: Over the last 13 months, the rate of inflation has been steadily increasing. In March 2021, however, the rate of inflation fell from 18.17 to 18.12 in April 2021. (Fig D). From 12.8 in July 2020, to 13.2 in August 2020. The composite food index reduced from 22.95 in March 2021 to 22.72 in April 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 anticipated inflation rate for the month of May is 15.4%. The relax of Covid-19 rule might contribute to the change in the rate of inflation trend.
- Exchange Rate and the LPG: The exchange rate experienced some decreases from N410.20/$1 to 410.17/$1 at the end of the 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 relationship between LPG price and crude oil price remains positive, as a by-product of crude oil. Crude oil prices rose continuously after an initial fall at the beginning of the week. (Figure F). This shows that the price of crude oil has not been stable in the international market. 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 $33.76 billion to $33.59 billion despite increases in the price of oil and fall of the Naira from 410.20/$1 to 410.17$1. Decease in the external reserve is due to the CBN policy on measure to stabilize naira rate against 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: Covid-19 causes demand for goods and services to fall due to the full or partial lock-down effect. The implication of the Covid-19 contracts to 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.
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
The prices in the weeks to come may rise due to the rise in the rate of exchange between naira and dollar
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.
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 
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.
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.
The prices in the weeks to come may rise due to the effect of increase in the rate of inflation.
Reuters reported on Wednesday that fuel shortages in the Southeast intensified as the shutdown of the country's major fuel pipeline network entered its sixth day, and Washington authorities promised to help alleviate supply concerns.
In the previous week, a ransomware attack on the Colonial Pipeline halted 2.5 million barrels of petroleum shipments each day. The pipeline runs 5,500 miles (8,850 kilometers) from oil refineries on the Gulf Coast of the United States to consumers in the Mid-Atlantic and Southeast.
Reuters reported in line with the new trade manager of the firm stated on Friday, Petroleo Brasileiro SA (PETR4.SA), which provides the company a large flexibility in practice to avoid foreign market volatility when setting prices.
As the Rio de Janeiro-based company is known, the period for which Petrobras calculates the international price parity of its fuels extended between three months and one year in 2020.
According to the Organization of Petroleum Exporting Countries (OPEC), compliance with the OPEC+ oil production cutbacks agreement totalled 122% in April, with production averaging 25.08 million barrels per day.
OPEC stated in its monthly report released on Tuesday that crude oil output climbed mostly in Nigeria, Iran, and Saudi Arabia, while production declined notably in Venezuela, Libya, and Angola.
Non-OPEC liquids output, which includes OPEC NGLs, decreased 0.18 million barrels per day in April compared to the previous month, to an average of 67.97 million barrels per day (down by 1.16 million barrels year on year).
Reeuter reported that the Australian government announced on Friday that its 2021-22 budget, which will be released on Tuesday, will include A$58.6 million ($45.3 million) to expand gas supply, storage, and pipeline capacity.
The funding is in line with the government's effort for a gas-fueled economic recovery from the COVID-19 pandemic depression, with the goal of increasing gas supply, lowering manufacturing costs, and averting an impending gas shortage in the country's southern areas. In a statement, Energy Minister Angus Taylor said that the government will not sit back and allow the shortage to occur - the risk to the economy is too great."
Egypt is focusing its strategy on the upstream section to compensate for the natural drop in its oil production. The country aspires to be a centre for energy production and export to the sub-countries region's as well as the European market.
Local companies Khalda Petroleum and Qarun Petroleum announced investments of $830 million and $252 million, respectively, in fiscal year 2021-2022 as part of a program to explore for oil and gas in Egypt's Western Desert. It will start in July 2021.
During the time period, Khalda Petroleum drilled 87 wells, 35 for exploration and 52 for development or production. This is planned to produce 130,000 barrels of crude oil and condensate per day on average, as well as 630 million cubic feet of natural gas per day.
The Daily News reported that the government has given aside approximately 100 hectares of land in Mtwara Region for oil and gas investment prospects, the National Assembly was informed on Friday.
Deputy Minister of Agriculture Hussein Bashe, speaking in Parliament on behalf of the Minister of Industry and Trade on Friday, said the government decision also prompted the implementation of the Mtwara Free Port Zone Construction Project, which includes the construction of a special section with berth and supply section for servicing investors in the oil and gas sector.
The Guardian reported that as part of initiatives to minimize deforestation, greenhouse emissions, and death from the use of solid fuels, the federal government is finalizing a plan to extend the equalization program to Liquefied Petroleum Gas (LPG).
The country's growing demand for petrol has raised the level of equalization petroleum product from 30% to above 100%, according to Bobboi, while the dilemma of inadequate infrastructure, which prompted the agency's foundation 45 years ago, continues.
The fund was established by Decree 9 of 1975 and amended by Decree 32 of 1989 with the primary responsibility of reimbursing petroleum products marketing organizations for any losses incurred purely and exclusively as a result of the selling of petroleum products at uniform pricing across the country.
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 
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: Over the last 13 months, the rate of inflation has been steadily increasing. In March 2021, however, the rate of inflation fell from 18.17 to 18.12 in April 2021. (Fig D). From 12.8 in July 2020, to 13.2 in August 2020. The composite food index reduced from 22.95 in March 2021 to 22.72 in April 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 anticipated inflation rate for the month of May is 15.4%. The relax of Covid-19 rule might contribute to the change in the rate of inflation trend.
The prices in the weeks to come may rise due to the effect of increase in the rate of inflation.
Russia, Iraq, Iran, the United States, Algeria, Venezuela, and Nigeria, according to the World Bank, have been the top seven gas-flaring countries for the past nine years.
n its gas flaring satellite data for 2020, the bank said this on Wednesday in Washington, D.C. According to the study, the seven countries produced 40% of global oil per year but accounted for roughly two-thirds (65%) of global gas flaring.
“This pattern reflects the current, while diverse, problems that these countries face.“ For example, the United States has thousands of individual flare sites that are difficult to link to a market. “However, a few high flaring oil fields in Russian Federation's East Siberia are extremely remunerative.
Reuters reported that COVID-19 has ignited in Canada's remote oil sands area in northern Alberta, disrupting critical annual maintenance work at the country's vast oil sands plants.
As Canada grapples with a third wave of the pandemic, the oil-rich province of Alberta is fighting the highest rate of COVID-19 in the world, and on Thursday set a new daily infection record, surpassing 2,000 for the first time.
The oil sands are located in the Regional Municipality of Wood Buffalo, which has the highest rate of active cases per capita in the province.
Reuters reported that investors unloaded positions after poor Japanese crude import data and concerns about fuel demand in India, where COVID-19 infections have soared, as oil prices dropped from six-week highs on Friday.
Fuel demand is mixed across the world, with consumption increasing in the US and China while other countries restart lockdowns to combat the growing infection rate.
Brent Crude for June settled at $67.25 per barrel, while West Texas Intermediate crude for June settled at $63.58 per barrel.
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.
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 
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.
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 
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.
The prices in the weeks to come may rise due to the persistent increase in the rate of inflation