Prices remained largely stable in the domestics and international market for LPG in the immediately preceding week.

Regional Disparity in Retail Prices

Regional disparity in the prices of LPG across the country has been a regular feature of the Nigerian LPG market. This gap, witnessed in the past three weeks, remained the same with the previous week.
Though the South-south geopolitical zone hosts the great majority of depots in the country due to its proximity to the ocean, prices have been highest in the region.

Macroeconomic Conditions & the Nigerian LPG Market

• The stability in the exchange value of the naira to the US. $ does not reflect the slight While we noted last week the increase in activities that the composite Purchasing Managers’ Index (PMI) for the non-manufacturing signals, we note that the report on slowing inventory and new orders in the LPG market (within the Electricity, gas, steam & air conditioning supply sub-sector) might have been accelerated in the face of global fall in economic activities and the rise in inflation in Nigeria.
• The foreign reserves of Nigeria had moved only slightly from US.$36,181,491,483 at the start of the week to US. $36,138,455,392.13 at the close of the week. This trend continues to reflect early signs of the drop in crude oil prices. The drop is only 0.17% from the 0.16% drop recorded last week.
• The drop in the reserve has implications for the value of the naira in the days and weeks to come and in turn the landing cost of LPG to Nigeria.

Macroeconomic Conditions & the Nigerian LPG Market

• The stability in the exchange value of the naira to the US. $ does not reflect the slight While we noted last week the increase in activities that the composite Purchasing Managers’ Index (PMI) for the non-manufacturing signals, we note that the report on slowing inventory and new orders in the LPG market (within the Electricity, gas, steam & air conditioning supply sub-sector) might have been accelerated in the face of global fall in economic activities and the rise in inflation in Nigeria.
• The foreign reserves of Nigeria had moved only slightly from US.$36,181,491,483 at the start of the week to US. $36,138,455,392.13 at the close of the week. This trend continues to reflect early signs of the drop in crude oil prices. The drop is only 0.17% from the 0.16% drop recorded last week.
• The drop in the reserve has implications for the value of the naira in the days and weeks to come and in turn the landing cost of LPG to Nigeria.

Outlook: Coming Weeks

• We affirm much of the predictions of the previous week. Price stability will be slightly upset as the gains from the slight drop in LPG prices internationally might be significantly offset by the rising inflation levels.
• A potential continuous drop in the value of the naira might signal increases in domestic LPG prices particular if such devaluation are followed by inflation.




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