Airlines face pricing dilemma as jet fuel surges by over 180%

Airfares in Nigeria have remained largely unchanged despite a sharp increase of about 184 per cent in aviation fuel prices over the past two months, driven by the ongoing crisis in the Middle East.

Sources within several airlines, who spoke on condition of anonymity due to the sensitivity of the issue, said that intense competition among domestic carriers has prevented operators from raising ticket prices.

Aviation fuel, which sold for about N900 per litre in January, rose to N1,121 per litre by February 26 and has now climbed to approximately N2,557 per litre. The commodity accounts for nearly 40 per cent of airlines’ operational costs, making it the single largest expense, followed by aircraft maintenance.

Despite the surge, ticket prices on major domestic routes have remained between N106,000 and N147,000. For instance, Ibom Air lists Lagos–Abuja flights at about N114,600, while United Nigeria Airlines offers Kano, Lagos routes at around N142,500. Aero Contractors’ Lagos,Abuja fares are among the lowest at about N106,286, while Air Peace maintains the highest fares at roughly N147,000 for the same route.

Industry insiders say airlines have kept fares at previous levels despite rising costs, putting significant pressure on their operations. They attribute this to stiff competition among approximately 15 domestic carriers, even as passenger traffic continues to decline.

Nigeria recorded 15.6 million passenger movements in 2024, down from 15.8 million in 2023 and 16.2 million in 2022, reflecting a steady drop in demand.

Fuel prices also vary across airports, with Sokoto recording the highest rate at N2,557 per litre, followed closely by Kano, Port Harcourt, and Asaba. Lagos currently has the lowest rate at about N2,500 per litre.

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