A recent in-depth analysis conducted by HydroCIS, a prominent data provider, has brought to light intriguing insights into the contrasting demand patterns for petrol and liquefied petroleum gas (LPG) in the month of July 2023.
This study’s findings have ignited discussions regarding the underlying drivers of these consumption shifts, prompting a closer examination of the factors at play.
Diverging Consumption Trends Emerge
Prior to the subsidy removal, petrol consumption, also known as PMS, was registered at 64.96 million litres. In an unexpected turn of events, July 2023 witnessed a substantial decrease in daily petrol consumption, plummeting to 52 million litres per day.
This sizeable reduction of 16.8% has raised questions about the reasons behind this significant decline.
Conversely, the consumption of LPG during the same period embarked on a contrasting trajectory.
With a month-on-month surge of 35%, LPG consumption reached an impressive 128 thousand tonnes (kT) in July 2023, culminating in a total of 729 kT for the year. This notable year-on-year growth of 16% underscores LPG’s rising prominence in the energy landscape.
Exploring the Shifts in Demand Dynamics
The divergence between these consumption patterns paves the way for an in-depth comparative analysis, inviting a closer examination of the intricate factors influencing the demand for both PMS and LPG.
Notably, HydroCIS highlights that this observation does not automatically imply a direct cause-and-effect relationship between the decline in PMS consumption and the concurrent surge in LPG consumption.
Critical to understanding this transformation is the context of fluctuating petrol prices. The initial spike in petrol prices, reaching N537 to N540 per litre, led to a noteworthy response from Nigerians. Many citizens swiftly adapted by converting their conventional petrol-powered generators to LPG-based systems.
This strategic transition presents an innovative approach to energy utilization, particularly in the face of power supply challenges.
Evolving from Petrol to LPG-Driven Generators
Uduma Igu, the Chief Executive Officer of Nanotron Technologies, shared insights from his personal experience, shedding light on the real-world implications of this shift.
He recounted how his hydrocarbon liquids enterprise bore a significant daily expense of up to N10,000 while relying on a petrol generator due to frequent power outages. However, upon transitioning to an LPG-powered generator, his operational costs witnessed a notable reduction.
This conversion trend extends beyond individual experiences, marking a broader trend in both business and residential spaces. The proactive move to adapt petrol generators to operate on LPG showcases Nigeria’s ingenuity in addressing energy challenges and optimizing resource utilization.
Predicting the Path Ahead
As Nigeria grapples with evolving energy needs, the surge in LPG consumption hints at a transformative trend in energy consumption and utilization. This shift has the potential to ease financial burdens on households and businesses alike, in the backdrop of ongoing power supply hurdles.
It is plausible that this transition will not only reshape energy dynamics but also foster an environment conducive to further innovations in the energy sector, ultimately shaping a more sustainable and efficient energy landscape for the nation.
