• Wednesday, February 28, 2024
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Businesses groan as diesel prices rise by 56% in 1yr

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The average retail price of Automotive Gas Oil, popularly known as diesel, paid by consumers increased by 55.90 percent in one year as businesses and households battled to maintain operations.

According to recent data from the National Bureau of Statistics (NBS), diesel prices rose year-on-year from N312 to N840 per litre in March 2023. On a month-on-month basis, it increased by 0.47 percent from N829 per litre in January.

Nigerian households and businesses are taking a beating as the rising cost of diesel and naira scarcity persist, coupled with a high inflation rate, pushing the cost of living higher.

Businesses have no choice but to increase the cost of their products to maintain their profit margin, while some households that use diesel generators have reverted to petrol generators and also renewable energy to cut their expenses.

Leke Opeyemi, a pump operator working for TINPET in Orile, Lagos, said sales had dropped significantly on the back of the steep rise in diesel prices in the past few weeks.

“The hike in price has affected sales,” said Opeyemi. “The number of people coming in has lessened, and the quantity they are getting has reduced.”

Many pump operators assigned to the diesel section have been having little to no activity, thereby dampening their zeal to resume work.

Even some stations (as of the time of this report), such as Saitaru in Orile and Golden Super in Ijora-Badia, have shut down their diesel pumps, focusing on petrol and kerosene sales.

Read also: Petrol prices soar 43% as subsidy removal nears

“The high cost of diesel is eating into our income,” Olufemi Omotayo, a truck driver in Lagos, said.

The issue becomes even more frustrating, according to the young man, when they have to pay several tax collectors (Agberos) on their interstate business travels.

“This is really not funny,” he said. “The government needs to come to our rescue and intervene.”

According to Alimat Adesanya, a printing press operator, it is tough to complete work because the cost of supplies has soared this time of year.

“We have reduced the time of operation of our diesel machine due to this hike,” he said.

Looking at the variations in diesel prices across different states, the NBS said the states with the highest average product price in March 2023 include Bauchi with N910, Abuja with N889 and Adamawa with N880.

On the other hand, the lowest price was recorded in Bayelsa with N768, followed by Katsina with N779 and Edo with N797.

The Zonal representation of average price of diesel shows that North East has the highest price of N856.42 while South South has the lowest price N816.92 when compared with other zones.