Businesses in Lagos try to stay afloat as fuel prices soar

Lagos is almost six thousand kilometers from the Strait of Hormuz, but the ongoing conflict in Iran is hitting the Nigerian city hard. 

Oluwatosin Awodunmila and her husband, co-owners of a printing business in Somolu, a mixed-income residential suburb in central Lagos, arrive early as usual, after dropping their two children at school.

The street is silent, partly because the day is just beginning and partly because there was no electricity. The machines in the shops are off.

Awodunmila scans the shop and the leftover projects to make — lip gloss, key holders, paper bags. But she has to wait for electricity, which hardly comes nowadays. The other option was to fire up the medium-sized generator outside the shop. But since the Iran war began, the price of fuel per liter has nearly doubled from 800 naira to 1,400 naira (60 cents to $1).

This jump in price has brought business to almost a halt. In Nigeria, the retail price of fuel determines the price of everything else. If they use the generator, the profit margin thins to almost nothing. They had decided not to increase the price of their service to keep their customers.

So they wait for electricity and sit, like on this morning, while customers lodge complaints about slow delivery. On Monday, four days earlier, there was no electricity until 7 p.m., and the fuel consumption for that day alone was 30,000 naira ($21.85), more than half of what they had hoped to earn on the day’s jobs.

Recently, they changed their delivery policy from one business day to three to five working days.

“My biggest wish right now is a 24-hour supply of electricity and the war in Iran to end — and of course, the cost of fuel should come down.”