Airline Operators Shutdown Operations Over Aviation Fuel

Airline Operators Shutdown Operations Over Aviation Fuel

Airline operators across Nigeria may shut down operations on Thursday over the high cost of aviation fuel.

The operators warned that should the Federal Government refuse to intervene in cost of aviation fuel, they would be withdrawing their services in the next 72 hours.

This was made known during their resumed meeting with oil marketers, the regulators, and the House of Representatives leadership on Monday.

Aviation fuel, also known as Jet A1, which sold for N190/litre and later N360/litre in January this year, rose to between N579 and N607/litre last week Tuesday.

Speaking on Monday through the Vice President, Airline Operators of Nigeria, Allen Onyeama, the operators said that with the current cost of fuel, they cannot sustain their operations.

Onyeama also condemned the marketers for refusing to disclose the actual amount they buy aviation fuel per litre.

Onyeama said, “I have the mandate of every airline in this country to announce to you that if they cannot come down from their rooftop, we have only three more days to be able to fly. We are not threatening this country. We have been subsidising what we are doing.

“I will give you the rate as of today, (at) N630, N640, N650 (per litre). We have an aircraft going to Kano that has about 7000 litres of fuel on it. Multiply it by 630. The unit cost per seat already is about N70,000 per seat. You have not talked about the insurance that is very static and Nigerians pay a lot of insurance premiums because this country is stigmatised.”

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He added, “You have to insure in London and other places abroad. It is a loss. All the insurance companies in Nigeria put together cannot even insure one aircraft. So, you have to go abroad to insure and they slam us with heavy premiums. What we use in insuring one plane is what the legacy airlines of this world use in insuring about three planes. So, the Nigerian airline is dead on arrival.

“Yet, the fuel cost which was supposed to be about 30 to 40 per cent (of operational costs) in every other clime in the world, in Nigeria it is about 70 per cent even before this time (of scarcity). So, you can now see the mortality rate of airlines in this country and the causes.”

The Air Peace boss challenged the marketers to disclose the actual price of aviation fuel, saying, “They have refused to answer your simple question. Whether you got money from the CBN or from the black market, how much is the unit cost of your acquisition so that we know if the airlines are cheating you or you are cheating the airlines, or if you have formed a cartel to increase your prices overnight.”

Onyeama stated, “From what is happening, if we continue this way, the least ticket you will expect from airlines will be about N120,000 for Economy (Class). And we don’t want to do that because it will not help the ordinary man.

“I have the mandate of airways to inform the House that we are now demanding that we should be given a license to import this fuel. If we can buy jets that cost about $80m, we can afford to import this fuel. Let NNPC give us the right to import fuel and we will not complain to you.”