We’ll See How Jet Fuel Price Cap Plays Out – Airline Operators

Airline operators in Nigeria have urged caution on the government’s recent aviation fuel price cap, saying they are waiting to see how marketers respond before taking any firm action, even as they have vowed to shut down operations if compliance falls short.

Speaking on behalf of the operators, spokesman of the Airline Operators of Nigeria (AON), Prof. Obiora Okonkwo, emphasised that the cap is not a strict regulation but a guideline aimed at stabilising costs in the volatile aviation fuel market.

Speaking exclusively with LEADERSHIP, Prof Okonkwo said recent engagements within the industry only produced a consensus on a pricing range, not a fixed cap.

“They did not peg the price because the industry is a regulated industry,” he said. “It was their resolution that the price should not be above a certain level. Everything being equal, it should be within this price.”

The remarks come amid soaring Jet A-1 fuel prices that have crippled airline profitability, forcing route cuts and fare hikes across Nigeria’s domestic carriers.

AON has long advocated interventions to curb what they describe as exploitative pricing by depot owners and marketers, who cite high import costs and foreign exchange shortages as justifications.

Okonkwo noted that while the development offers some validation of AON’s long-standing position on fair pricing, its real impact will depend on market compliance.

“It’s only when we see how that will play out. I just hope the market will revert and do the needful,” he added.

Okonkwo, who is also the chairman of United Nigeria Airline, noted that while the development offers some validation of AON’s long-standing position on fair pricing, its real impact will depend on market compliance.

He stressed that the situation in the aviation sector remains dire, with rising fuel costs continuing to erode operators’ financial stability and disrupt flight operations.

“We have said before that it’s becoming more difficult to operate. You can even see that in the daily schedule of airline operators.

“If a business model will not allow an operator to continue, we cannot stop anyone,” he said when asked if operators would shut down on Thursday.

The AON spokesman warned that the industry is already under significant strain, raising concerns about possible airline exits if conditions do not improve.

“That confirms again what we had hinted — that the industry is in distress,” he said.

According to him, the persistent surge in Jet A1 prices is putting severe pressure on airlines’ cash flow, despite efforts by operators to sustain services.

“Jet A1 has to be properly delivered and available at an affordable price,” Okonkwo said. “Because of how much operators have put together to sustain operations, it is beginning to stress their cash flow.”

He called for immediate intervention measures similar to those adopted in other countries, including fiscal reliefs and policy adjustments.

“There are things that must be deferred, especially those related to government agencies,” he stated, adding that timely support is critical to stabilising the sector.

Jet A1 prices in Nigeria rose from about N900 per litre in late February 2026 to over N3,300 per litre by mid-April, an increase of more than 300 per cent in a few weeks.

Airlines and the Airline Operators of Nigeria (AON) have described the surge as “artificial” and unsustainable, arguing that it far outpaced global crude oil trends, which rose by only about 30 per cent over the same period.

The Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) has intervened by capping Jet A1 prices between N1,988 and N2,037 per litre, but airlines are waiting to see how marketers respond to the price cap.

The Ministry of Aviation has joined the AON and oil marketers in high-level talks aimed at stabilising Jet A1 pricing and averting a shutdown of domestic flights.

AON has formally warned of a nationwide shutdown of airline operations, starting 20 April 2026, unless pricing and supply conditions improve, underscoring the financial strain on carriers’ cash flows and flight schedules.