The Federal Government has rolled out emergency measures to address Nigeria’s deepening aviation fuel crisis, directing marketers to sell directly to airline operators and extend a 30-day credit facility in a bid to stabilise supply and ease mounting financial pressure on carriers.
The intervention followed a series of high-level engagements convened by the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), alongside earlier meetings hosted by the Ministry of Aviation and Airspace Management on April 22–23.
The sessions brought together key stakeholders, including the Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA), Nigerian Civil Aviation Authority (NCAA), airline operators, and aviation fuel marketers.
According to an executive summary of the deliberations obtained in Abuja, stakeholders urged urgent regulatory steps to tame price volatility linked to global oil benchmarks.
“To ensure price stability, NMDPRA should engage relevant parties to adjust premiums linked to Platts and recent refinery cost variations,” the document stated.
The meeting also produced a new indicative pricing band, fixing aviation fuel at between N1,760 and N1,988 per litre in Lagos and N1,809 to N2,037 per litre in Abuja, based on average global prices recorded between April 17 and 23.
However, the document warned that “products purchased outside this window may be higher due to high volatility in current prices precipitated by the U.S.-Iran war and varying operational costs by operators.”
As part of broader reforms, stakeholders recommended streamlining airport fuel distribution by restricting operations to marketers with verifiable infrastructure, while the Ministry of Aviation was tasked with facilitating talks between airlines and suppliers over outstanding debts.
“Marketers should consider a 30-day credit window for airlines to pay up for supplies made,” the summary added, noting that inclusion of Aviation Turbine Kerosene in the Federal Government’s naira-for-crude initiative could further stabilise pricing.
Despite the measures, pressure continues to mount on airline operators, with fuel costs now accounting for a dominant share of operating expenses. Industry sources say airlines are spending upwards of N7 million to fuel a single domestic flight, raising concerns about sustainability.
Ibom Air highlighted the severity of the crisis, disclosing that its per-flight fuel cost has jumped from N2.1 million in January to about N7.6 million as of late April. “The fuel price situation is an unprecedented crisis for Nigeria’s domestic airlines,” the carrier said, adding, “we are now paying approximately N7.6 million to fuel every flight, compared to just over N2 million a few months ago.”
The airline warned that the spike representing a more than 350 per cent increase within weeks is becoming unsustainable. “At this point, airlines are absorbing huge losses because competitive pressures have prevented a commensurate rise in fares,” it said, cautioning that “if this trend continues, operators may be forced to cut capacity or scale down operations.”
Similarly, the Airline Operators of Nigeria (AON) raised alarm over the trajectory of prices, noting that aviation fuel now exceeds N3,000 per litre after logistics and storage costs. “The current price regime is unsustainable and poses a real risk of service disruptions if urgent intervention is not implemented,” the group said.
Meanwhile, the Dangote Petroleum Refinery continues to benefit from strong global demand and premium pricing for jet fuel, particularly in European markets. The $20bn facility, with a capacity of 650,000 barrels per day, is producing about 24 million litres of jet fuel daily, with a significant portion exported abroad.
Although the refinery’s ex-depot price is estimated at about N1,879 per litre close to import parity, industry players say additional logistics, storage, and distribution costs significantly raise the final price paid by airlines. Analysts note that Nigeria’s deregulated fuel market means prices largely reflect international trends, limiting the impact of local refining on domestic affordability.
The situation is further complicated by tensions between airlines and ground handling companies over debts exceeding N9 billion. Members of the Aviation Ground Handlers Association of Nigeria have issued a seven-day ultimatum, threatening to withdraw services.
Affected firms include Nigerian Aviation Handling Company Plc and Swissport Handling Company, raising fears of widespread disruption to flight operations.
Stakeholders say while the Federal Government’s latest measures may offer short-term relief, deeper structural reforms are needed.
“Direct sales and credit support may ease immediate pressure, but long-term stability will depend on fixing supply chain inefficiencies and improving access to crude for local refining,” one industry analyst said, warning that “without sustained intervention, the sector could face significant operational cutbacks in the weeks ahead.”