NMDPRA Recommends Direct Fuel Sales to Airlines
Nigeria’s aviation fuel market is facing renewed regulatory intervention as the Nigerian Midstream and Downstream Petroleum Regulatory Authority (NMDPRA) moves to stabilise rising costs affecting domestic airlines.
A technical committee convened by the regulator on April 24, 2026, has recommended that Jet-A1, commonly known as aviation fuel, should be sold within a price band of N1,760 to N1,988 per litre in Lagos and N1,809 to N2,037 per litre in Abuja. The recommendation follows sustained complaints from airline operators over escalating fuel costs, which remain a major component of operational expenses.
According to a statement issued after the meeting, the proposed pricing framework is based on Platts average benchmark prices recorded between April 17 and 23, 2026. The regulator noted that purchases outside that pricing window could attract higher costs due to ongoing volatility in global oil markets.
NMDPRA attributed part of the price instability to geopolitical tensions, including the ongoing conflict between the United States and Iran, alongside varying operational costs across the supply chain. The agency said these factors continue to influence the landing cost and distribution margins of aviation fuel in Nigeria.
Beyond pricing, the committee recommended structural changes to the supply chain. It advised that petroleum marketers should sell directly to airline operators within the period covered by the pricing band, a move aimed at reducing intermediary costs and improving transparency in transactions.
The regulator also proposed a credit framework that would allow airlines up to 30 days to settle payments for fuel supplied. This measure is expected to ease cash flow pressures on operators, many of whom have faced financial strain amid fluctuating fuel prices and foreign exchange challenges.
To further address inefficiencies, NMDPRA said it would collaborate with the Federal Airports Authority of Nigeria (FAAN) and the Nigerian Civil Aviation Authority (NCAA) to review and validate airside fuel distributors. The process is intended to streamline the number of operators based on defined infrastructure and operational criteria.
The statement also indicated that the Ministry of Aviation is expected to facilitate discussions between oil marketers and airline operators to resolve outstanding debts within the sector, a recurring issue that has affected supply consistency.
In addition, the regulator recommended that aviation turbine kerosene be included under the Federal Government’s Naira-for-crude initiative, a policy designed to reduce exposure to foreign exchange volatility in petroleum product transactions.
While the recommendations are yet to be formally adopted as binding directives, they reflect ongoing efforts by regulators to balance market realities with the sustainability of Nigeria’s aviation sector.