Nigeria’s aviation fuel problem is no longer just about supply. It is now about cash flow, pricing structure, and who carries the cost.
The Federal Government, through the Nigerian Midstream and Downstream Petroleum Regulatory Authority, is asking marketers to give airlines a 30-day credit window and sell fuel directly to them. On the surface, that looks like relief. In reality, it shows how tight things have become for operators who can no longer pay upfront for fuel at current prices.
The numbers explain the pressure. Jet A1 is already hovering within an official band of roughly N1,700 to over N2,000 per litre, but airlines say what they actually pay, after logistics and storage, is closer to N3,000. That gap is not small. It is the difference between a business surviving and one cutting flights.
Airlines are now spending over N7 million to fuel a single domestic trip. Ibom Air puts it at about N7.6 million per flight, up from just over N2 million earlier in the year. That jump did not happen gradually. It happened within weeks. Fares have not moved at the same pace, which means airlines are absorbing losses on every flight.
The government’s response, pushing for credit sales, is a short-term fix. It does not bring prices down. It only delays when airlines have to pay. The risk is that it shifts the pressure to fuel marketers, who are also dealing with high costs tied to global pricing benchmarks like Platts. Someone still carries the burden, it is just being moved along the chain.
The bigger issue sits inside the pricing structure itself. Nigeria is operating a deregulated market, so jet fuel prices follow global trends. But local realities are different. Logistics gaps, multiple intermediaries, and airport bottlenecks push costs higher before the fuel even reaches aircraft. That is why the same product ends up far more expensive locally than in other markets.
There is also a contradiction playing out. The Dangote Petroleum Refinery is producing large volumes of jet fuel, about 24 million litres daily, but a significant share is going to Europe where margins are stronger. Locally, airlines are struggling to buy the same product. So while the refinery is taking advantage of global demand, domestic operators are dealing with scarcity pricing.
That disconnect is what is driving the crisis. It is not that fuel does not exist. It is that the market is structured in a way that makes it expensive for local users to access it.
At the same time, supply constraints are still in the background. Limited access to local crude, tied up in forward sales and loan-backed deals, means refineries rely on imported feedstock. That adds cost before refining even begins.
What this creates is a chain reaction. Expensive crude leads to expensive fuel. Expensive fuel pushes airline costs up. Airlines cannot fully transfer those costs to passengers, so margins collapse. The credit window being proposed is essentially buying time in a system that is already stretched.
The risk now is operational. Ground handlers are already threatening to withdraw services over unpaid debts. If that happens alongside rising fuel costs, flights will not just become expensive, they will reduce.
This is why the current intervention feels narrow. Direct sales, credit terms, and pricing bands address symptoms. The core problem is structural, how fuel is priced, how it is distributed, and how much of it is actually prioritised for the domestic market. Until those pieces align, the aviation sector will keep running on temporary fixes, not stability.
