Market News

A technical committee set up by the federal government has recommended the inclusion of aviation fuel in the naira-for-crude scheme.

The committee was constituted following a high-level meeting convened by Festus Keyamo, the minister of aviation and aerospace development, on April 22 and 23, to address challenges around the supply and pricing of aviation fuel, also known as Jet A1.

The meeting had in attendance representatives from the ministry of aviation, ministry of petroleum resources, Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA), Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA), Nigerian Civil Aviation Authority (NCAA), airline operators, and aviation fuel marketers.

Following the resolution, NMDPRA, in a statement on Sunday, said it convened a meeting of the technical committee on April 24 to discuss the issues and recommend the way forward.

On April 14, the Airline Operators of Nigeria (AON) threatened to suspend operations from April 20 over the rising cost of aviation fuel.

The operators said the price of Jet A1 has increased from N900 per litre as of February 28 to N3,300 per litre — representing a rise of over 300 percent.

To cushion the impact of the rising aviation fuel cost, Tinubu approved a 30 percent discount on debts owed by domestic airlines to aviation agencies.

OTHER RECOMMENDATIONS MADE AT THE MEETING

Following the engagements and current market fundamentals, the committee said the indicative end-user price for aviation fuel should range between N1,760 – N1,988 per litre and N1,809 – N2,037 per litre in Lagos and Abuja, respectively.

“The indicative prices are based on Platts average prices for the period 17th – 23rd April 2026. Products purchased outside this window may be higher due to high volatility in current prices precipitated by U.S. Iran war and varying operational costs by operators,” the statement reads.

“NMDPRA should direct marketer to sell directly to the Airline operators within this period.

“To ensure price stability, NMDPRA should engage DPRP to adjust the premium on Platts and cost variation element that was recently increased by the Refinery.”

Also, the committee proposed that NMDPRA work with FAAN and NCAA to validate airside fuel distributors and reduce the number of operators based on agreed criteria.

“Marketers should consider a 30-day credit window for airline to pay up for supplies made,” the statement reads.

“NMDPRA to recommend the inclusion of ATK under the Naira for crude Initiative.”

On July 29, the federal executive council (FEC) approved a proposal by President Bola Tinubu directing the Nigerian National Petroleum Company (NNPC) Limited to sell crude oil to Dangote Petroleum Refinery and other refineries in naira.

The naira-for-crude scheme commenced on October 1.