The airline umbrella body made this known on Wednesday, through its Vice Chairman, Mr. Allen Onyema, at the maiden edition Federal Airports Authority of Nigeria (FAAN) National Aviation Conference (FNAC) who warned that if the present challenge of aviation fuel was not nipped in the bud, more airlines may shutdown operations in the coming months.
There are fears that at least three domestic airlines may close shop in the coming months due to the continuous rise in the price of Jet A1, otherwise known as aviation fuel in the local parlance.
This is as the Airline Operators of Nigeria (AON) has raised the alarm that aviation fuel has skyrocketed to 714 per litre in some airports in the country, thereby further compounding the woes of the operators.
Also, companies in the Nigerian aviation industry – aviation fuel marketers, airline operators, ground handling companies and catering services among others have bemoaned the paucity of foreign exchange and the collapse of naira against major currencies.
Speaking at the maiden edition Federal Airports Authority of Nigeria (FAAN) National Aviation Conference (FNAC) with the theme: ‘Advancing the Frontiers of Possibilities for Safe, Secure and Profitable Air Transport’, in Abuja on Wednesday, Mr. Allen Onyema, the Vice Chairman of AON, warned that if the present challenge of aviation fuel was not nipped in the bud, more airlines may shutdown operations in the coming months.
The AON Vice Chairman who refused to name the airlines that could go out of business soon, however said that the aviation fuel challenge was not limited to Nigeria alone, but emphasized that ours is made worse because of the slump of naira against major currencies, especially the dollars.
According to AON, in order to address the challenge, the Federal Government had approved 10,000 metric tonnes of aviation fuel to the airlines, but said the carriers were yet to access it.
Onyema explained that the airlines hoped to start lifting the 10,000 metric tonnes of aviation fuel from Thursday.
He said: ”That is why we ran to the government and the Federal Government has given us about 10,000 metric tonnes of fuel at the cost of N580 per litre in Lagos and about N607 per litre outside Lagos.
”This is not the only issue. Since the COVID-19 crisis, most airlines all over the world, including Nigeria have not recovered from COVID-19, except those whose countries have injected so much funds to assist them. This is no body’s fault. It just happened. Government has tried it’s best by giving us this aviation fuel. This aviation fuel can take airlines out, not only in Nigeria but everywhere in the world.
”Some airlines outside Nigeria have closed down because of the effects of rising aviation fuel. If these things are not addressed in Nigeria, it can affect the bottom line of all airlines in Nigeria.
”We have come to realize that there is little or nothing the committee set up can do because this is as a result of foreign exchange and price of oil all over the world now. The fuel marketers will sell according to what they are paying. The cost of aviation fuel has increased, even in London and every other country. Our own is worse because of the increase in foreign exchange.”