High Aviation Taxes, Jet Fuel Costs Push Airfares Beyond Reach of Nigerians — Airline Executive

The Federal Government has been urged to urgently review aviation taxes, charges and other regulatory levies as mounting operating costs continue to push airfares beyond the reach of many Nigerians.

Chief Commercial Officer of United Nigeria Airlines, Adedayo Olawuyi, made the call on Wednesday at the AeroWest conference in Lagos, where industry stakeholders examined the challenges confronting Nigeria’s aviation sector.

The conference, themed “The Real Cost of Running Aviation Business: Fixing Connectivity, Affordability, FX, Fuel and Border Friction,” focused on the rising cost of running airlines and its implications for connectivity and passenger affordability.

Olawuyi said domestic airlines were operating under intense financial pressure, with high borrowing costs, foreign exchange exposure, aviation fuel prices and maintenance expenses threatening the sustainability of operators.

He questioned the viability of borrowing at extremely high interest rates when airline profit margins remain relatively low.

«“How many of you would take a loan of 30% to invest in a business that gives you less than 5% profit?” he asked.»

According to him, the challenge goes beyond the airlines themselves, stressing that government, regulators and industry operators must work together to create conditions that will support affordable and sustainable air transport.

‘If the goose dies, everything is lost’

Olawuyi also raised concerns about the commercial viability of several routes across West Africa, where airlines often struggle with low passenger volumes.

He said carriers needed to deploy aircraft that correspond with the size and demand of individual markets rather than operating oversized aircraft on routes that cannot support them financially.

“We all focus on making money from airlines. As my boss says, the airline is the goose that lays the golden egg, and everybody wants a piece of it. But at the end of the day, if the goose dies, everything is lost,” he said.

He warned that excessive charges and operating costs could ultimately undermine the aviation industry by weakening airlines and making tickets increasingly unaffordable for passengers.

Jet A1 price surge adds to pressure

A major concern highlighted at the conference was the sharp increase in aviation fuel prices.

Olawuyi said the price of Jet A1 had risen from approximately ₦900 per litre in December 2025 to about ₦3,000 per litre in 2026, significantly increasing the cost of operating flights.

He identified aviation fuel, foreign exchange, aircraft maintenance, pilot training and financing as some of the biggest cost drivers confronting Nigerian airlines.

The sector is particularly vulnerable to foreign exchange fluctuations because airlines earn much of their revenue in naira while several major expenses, including aircraft leases, maintenance and training, are denominated in foreign currencies.

Olawuyi stressed that airlines could not respond to rising costs by compromising safety-related expenditure.

High costs threaten affordable air travel

The increasing cost of operating airlines has direct implications for passengers, with carriers under pressure to transfer some of their expenses to consumers through higher ticket prices.

Aviation fuel alone accounts for more than 40 per cent of airline operating costs in Nigeria, according to aviation fuel expert Peter Zira Dia.

Industry stakeholders have also warned that disruptions in fuel supply could trigger flight delays and cancellations, while higher Jet A1 prices could ultimately translate into more expensive air tickets.

The cost of training pilots presents another challenge. The shortage of simulator and type-rating facilities in Nigeria means some pilots have to travel abroad for mandatory training, adding foreign exchange, transportation and accommodation expenses to airlines’ operating bills.

Nigeria faces regional aviation cost challenge

The pressure is not limited to Nigeria. Across West Africa, taxes and charges on air passengers remain among the highest in Africa.

An Atlantic Council assessment put the average tax on air passengers in West Africa at about $110 per departure, compared with approximately $32 in Europe for comparable short regional journeys.

The International Air Transport Association has also identified aviation charges in Nigeria as being above global averages, while the Centre for the Promotion of Private Enterprise has estimated that taxes, fees and regulatory levies can account for as much as 35 per cent of airline revenues.

An August 2026 Atlantic Council brief, “Opening Africa’s Skies to Trade, Growth and Jobs,” identified high taxation, restrictive regulations, blocked airline revenues and dependence on imported aviation fuel among the major barriers to the expansion of Africa’s aviation sector.

ECOWAS ticket-tax plan yet to take effect

The call for a review of aviation charges comes amid an earlier regional commitment by ECOWAS to reduce the tax burden on air passengers.

In December 2025, ECOWAS announced plans to abolish air ticket taxes across the sub-region from January 1, 2026, as part of efforts to reduce airfares and improve regional connectivity.

However, as of September 2026, the proposed abolition had yet to take effect.

Stakeholders say the continued burden of taxes and regulatory charges, combined with high fuel prices, foreign exchange costs and expensive aircraft maintenance, is making it increasingly difficult for airlines to offer affordable fares while remaining commercially viable.

Olawuyi therefore called for a coordinated response from the Federal Government, regulators and aviation operators, warning that without urgent intervention, the rising cost of doing business could further weaken domestic airlines and restrict air travel to a smaller segment of Nigerians.

For an industry that is expected to drive regional connectivity, tourism, trade and economic growth, stakeholders say reducing the cost of operating flights will be critical to making air travel more accessible to Nigerians and ensuring the long-term survival of domestic carriers.