Nigerian domestic airfares to report sharp rise

Nigeria's domestic air travel is expected to see a sharp increase in the coming months, as carriers try to stay afloat amid rising fuel prices (Business Day Online, 04-Aug-2011). A report released by Augusto & Co stated the hike in jet fuel prices would adversely affect carriers in the domestic market. "In 2011, we envisage high oil prices through the year, occasioned by a prolonged civil crisis in some oil rich regions like Libya. This would translate to a hike in aviation fuel prices through import shortages and speculative hoarding. The resultant effect would be lower margins for domestic airlines if consumers resist an increase to air fares," the report stated. The domestic aviation sector is continuing its five-year run of low profit margins and still faces debt owed to regulators and service providers.