An increase in the cost of aviation fuel has led to an all-time high in the price of flight tickets for Africa’s biggest economy, something Nigeria has never experienced in the history of its aviation industry. The worst part is that airline operators have no solution in sight and prices only continue to rise. They are currently pleading with the government to intervene lest the economy gets blown by a tsunami of multiple shutdowns.

Embraer E195 E2 Air Peace
Photo: Embraer

Steep flight costs

As of Thursday, August 18, an Airmax Jos to Lagos return ticket was N280,000 ($672), Port Harcourt to Kano N306,000 ($734), Lagos to Katsina N148,000 ($355), and Abuja to Lagos prices fall between N148,000-N155,000 ($355-$372). Abuja to Kano tickets ranges between N74,000 ($178) and N100,000 ($240). Lagos to Abuja return tickets cost N200,000 ($480), Lagos to Kanu are N150,000 ($360)-N200,000 ($480), depending on the booking time and the airline used.

Air peace’s return ticket from Abuja-Kano is between N140,000 ($336) and N160,000 ($384). A one-way ticket for the same flight is about N78,000 ($187). A one-way ticket from Lagos to Enugu costs N150,000 ($360). These ticket prices represent what is by far the highest flying cost the country has had in its entire history.

Dana Air McDonnell MD-83 parked at Lagos airport.
The prices seen in Nigeria today are some of the highest the country has ever faced. Photo: Kenneth Iwelumo via Wikimedia Commons

The sharp rise in flight ticket prices can be attributed to the soaring costs of aviation fuel. The cost of JET A1 has shot up from N200 per liter ($0.48) last year to a high, so far, this year of N903 ($2) per liter. The fuel is not only expensive but also scarce. Nigeria only exports crude oil and depends solely on the importation of refined oil.

The Russia-Ukraine war has disrupted the supply of this refined product, and that has led to a current cost of operation that has made it almost impossible for some airline companies to survive. Indeed, some have sadly had to close shop. Aero Contractors, which is the oldest airline in Nigeria, has suspended flights indefinitely since mid-July. Dana Air, on the other hand, had its license suspended due to operational inflation.

More airlines at risk of closure

Aviation experts continue to worry that if this trend is not arrested, the whole industry may collapse. One such industry pundit, Goddy Ike, predicted that many more airlines could close.

“Government must immediately license companies and individuals…who can import these (fuel) products at fair prices and have them readily available in Nigeria so that airlines will…bring down the cost of flying.”

Ike said there is no other way the Nigerian government will rectify this situation if jet fuel is still imported and the aviation companies depend only on that.

The Nigerian Naira has also depreciated, which puts the entire economy at a disadvantage in terms of foreign exchange. Airlines will have to part with huge amounts of the Nigerian currency to procure JET A1, and this further reduces the profit margin. Other experts have actually reported that the airline business is no longer creditworthy and most companies are on the verge of suspending service.

Air Peace has already suspended its flights to Johannesburg, South Africa, amid problems for passengers in obtaining timely visas to visit the country. Allen Onyema, the CEO of Air peace said they were no longer getting sufficient passengers, making flights to and from South Africa impossible to operate. He concluded by saying this problem needs a joint effort from all stakeholders in the sector. Letting airline operators struggle alone to remain in business will only lead to more failures, which will affect the entire economy in so many ways.

Air peace Cabin crew
Air Peace has pulled out of South Africa amid visa issues and struggles to maintain profitability. Photo: Air Peace

The impact of fewer airlines on ticket prices

In mid-July, Aero Contractors announced that it would suspend its operations due to unbearable and challenging work conditions. Around the same time, Nigeria Civil Aviation Authority (NCAA) relinquished Dana Air of its air transport license after an audit that showed that the airline was unable to meet its financial obligations and operate safe commercial flights. What did this mean to the unit cost of a flight ticket in Nigeria? You can almost guess.

The remaining airlines had to struggle to meet the market demand. They saw an increased footfall from passengers, but the number of available aircraft did not increase. Consequently, ticket prices soared. Travel airfares increased by 282% to N2.1M ($504,000) per trip by the end of July. JET A1 prices similarly increased by 86.3% in the same month.

The travel and tours sector is also being crippled by these overwhelming price increases. Adeko Austin of Gatewind Travels and Tours said earlier this month that local flights cost between N70,000 ($168) and N120,000 ($288) and international tickets are somewhere in the region of N600,000 ($1,440) to 1.5M ($3,600). This compares to a previous average cost of N200,000 (around $450). He said dialogue is the way out of the economic mess.

“The Government should provide the necessary support to all stakeholders and air operators to enable them to have talks with the foreign suppliers of fuel.”

He observed that the inconvenience of limited seats led to flight delays, in addition to last minute changes by airlines making the already bad situation worse.

What do you think the solution is for Nigerian aviation? Let us know in the comments.