There are strong indications that some Nigerian airlines are in danger of going under unless the price of aviation fuel is reduced.
Aviation industry experts have observed that despite the increase in base fair to N200,000 by some airlines, the situation remains very dire for them
High cost of flight ticket, experts said, cannot help operators who are already steeped deeply in debt.
Their cost of operation, he stated, exceed their revenue since March 2026, when the price of crude oil went up due to Iran-US war.
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The experts were of the view that as long as the airlines buy aviation fuel, known as Jet A1 between N1, 650 and N2, 037 per litter, they would continue to face fiscal uncertainty.
They also noted that the high cost of flight ticket would drastically reduce the number of air travellers after the Sallah festivities, regretting that the financial challenge airlines are facing is already affecting other organisations in the aviation industry, including aviation agencies, handling companies and other service providers.
Industry analyst and second Vice President of Aviation Round Table, Dr. Alex Nwuba, said the escalating cost of Jet A1 fuel takes nearly half of total airline operating expenses and has forced domestic carriers to raise fares to levels that many Nigerians can no longer afford.
"Unlike international carriers, domestic operators have a much smaller fuel footprint, consuming approximately 600,000 litres of Jet A1 per day," Nwuba said, adding that as long as the cost of aviation fuel is still high, airlines will continue to accumulate debts because the revenue they are generating cannot defray their cost of operation.
Recently the federal government pledged to forgive airlines 30 per cent of the debts they owe aviation agencies in a bid to remedy the situation
According to the statement, "As an interim response, President Bola Ahmed Tinubu graciously granted us a 30 per cent concession. We are still waiting for the government decision on the other aspects of the AON intervention request. While the AON acknowledges and appreciates this gesture, we had appealed for a meeting with Mr. President to discuss further reliefs, a request that is yet to be granted."
Nwuba said Aviation Round Table, has developed and is putting forward the Fuel-for-Stability Programme (FFSP) as a policy recommendation to the federal government.
"The federal government's proposal to forgive 30 per cent of airline debts--estimated at roughly N200 billion--would eliminate N60 billion in receivables owed to Federal Airports Authority of Nigeria (FAAN), Nigerian Airspace Management Agency (NAMA), Nigeria Civil Aviation Authority (NCAA), Nigeria Meteorological Agency (NIMET) and other aviation service providers. This is not only insufficient but counterproductive.
"It weakens the financial position of aviation agencies, encourages future non-payment, and fails to address the structural cause of airline distress: the cost of fuel. Without reducing the price of Jet A1, airlines will continue to accumulate new debts even after old ones are forgiven. The write-off becomes a temporary relief that does not prevent future insolvency," he said.
Nwuba further explained that the Fuel-for-Stability Programme (FFSP), as recommended by the Aviation Roundtable, offers a more sustainable and economically rational solution, remarking that the programme is designed exclusively for domestic operators and implemented strictly through local refiners.
Commenting, the Managing Director and CEO of Aero Contractors, Captain Ado Sanusi, said that for the aviation industry to survive, government should adopt policies aimed at long term survival of the airlines.
He frowned at the many taxes the airlines pay, which he said erodes their chance of operating profitably.
He noted that government must ensure that the airlines survive, considering the critical role they play in the economic development of the country.
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Sanusi reiterated that aviation agencies should not rely on airlines to generate revenues, hence the high taxation and charges levelled at the airlines which impinge on their survivability.
To have robust aviation industry, he added, government must not see aviation agencies as revenue generating concerns but organisations that thrive on debt recovery to sustain their services.
Sanusi observed that the aviation industry is facing a systemic problem, which must be addressed in order to have a progressive sector.
He emphasised that government must enunciate policies that will ensure the sustainability of operating airlines successfully in Nigeria and it is only then that domestic airlines will start growing.
"Aviation agencies are not supposed to depend on the money paid to them by the airlines. Even if the Nigerian economy improves in the future, the idea of airlines paying the agencies for their sustenance is not sustainable," Sanusi further said.
