The Federal Government has announced plans to waive debts owed by domestic airlines to aviation agencies as part of urgent steps to address the rising cost of aviation fuel, also known as Jet A1.
The move follows growing concerns in the aviation sector over the sharp increase in fuel prices, which has pushed many local airlines to the brink and raised fears of a nationwide shutdown.
Minister of Aviation and Aerospace Development, Festus Keyamo, disclosed the government’s plan during a high-level meeting with airline operators in Abuja on Wednesday evening. The meeting was convened to find solutions to the ongoing crisis in the sector.
According to the minister, the intervention was approved by President Bola Ahmed Tinubu after he was briefed on the situation.
Keyamo said the President had directed that a request be brought forward to grant relief to the airlines, starting with a reduction in the debts they owe aviation agencies such as the Nigerian Airspace Management Agency (NAMA), the Federal Airports Authority of Nigeria (FAAN), and the Nigerian Civil Aviation Authority (NCAA).
He explained that the exact level of the debt waiver would be decided by the President, but noted that the gesture is aimed at easing the financial burden on airline operators.
The minister also said the President expressed appreciation to the airlines for not increasing ticket prices despite the rising cost of operations. He noted that the government understands the challenges faced by operators and is ready to support them.
In addition to the planned debt relief, the Federal Government is also considering broader reforms in the aviation sector. Keyamo revealed that the President has approved the setting up of a committee to review multiple taxes, levies, and charges imposed on domestic air travel.
The committee, he said, will be given a deadline to recommend which fees can be reduced or removed entirely to make air travel more affordable for Nigerians and reduce pressure on operators.
He added that the President is also planning to meet directly with airline operators to discuss long-term solutions, including access to funding and other structural challenges facing the industry.
The crisis in the aviation sector has been largely driven by the sudden and steep increase in the price of Jet A1 fuel, which is a major cost component for airlines.
Chairman of Air Peace, Allen Onyema, who spoke at the meeting, described the situation as critical and unsustainable.
He explained that the price of Jet A1 fuel rose sharply from about N900 per litre in late February to over N3,300 per litre within a few weeks. This represents an increase of more than 300 percent, a development he said has left airlines struggling to survive.
Onyema noted that the increase in fuel prices in Nigeria does not reflect global trends in crude oil prices. He argued that normally, increases in fuel prices should be proportional to changes in crude oil prices, but this has not been the case locally.
He also linked the situation partly to global supply disruptions, including tensions around the Strait of Hormuz, a key oil shipping route. However, he insisted that the scale of the price increase in Nigeria remains difficult to explain.
According to him, airlines had earlier considered shutting down operations because they could no longer afford to continue running flights under such high costs.
He said the decision to threaten a shutdown was not taken lightly, but was necessary to draw attention to the crisis. Airlines, he explained, were finding it increasingly difficult to borrow money to sustain operations, especially as most of their earnings were being used to pay for fuel.
Onyema added that safety remains a top priority for airlines, and operators were not willing to compromise maintenance and safety standards due to financial pressure.
He confirmed that the planned shutdown, which was initially scheduled to begin on April 20, 2026, was suspended following appeals from the government.
The Airline Operators of Nigeria (AON) had warned that if urgent action was not taken, airlines would be forced to halt operations nationwide. The group said the rising cost of fuel had made it impossible for revenues to cover operating expenses.
The suspension of the shutdown has provided temporary relief for passengers, many of whom rely on air travel for business and personal reasons across the country.
Despite welcoming the government’s intervention, Onyema called for more decisive action. He urged the President to consider a full waiver of all debts owed by airlines, rather than just a discount.
He also suggested that repayment of debts should be suspended until the global situation affecting fuel supply improves.
Another major concern raised by airline operators is the high cost of borrowing in Nigeria. Onyema pointed out that while airlines in other countries can access loans at interest rates as low as three percent, Nigerian airlines often face rates between 30 and 35 percent.
He described this as a major challenge that continues to weaken the industry and contributes to the accumulation of debts.
To address this, he appealed to the government to strengthen the Bank of Industry by providing more funding. This, he said, would allow airlines to access loans at lower interest rates and improve their financial stability.
Industry observers say the aviation sector plays a key role in Nigeria’s economy, supporting trade, tourism, and business activities. Any disruption in flight operations can have wide-reaching effects on economic activities across the country.
The current crisis has also raised questions about the regulation of fuel pricing and the role of marketers in the supply chain. Operators have called for greater transparency in how prices are determined.
Some have pointed out that even locally refined fuel, including supplies linked to the Dangote refinery, is reportedly cheaper, yet prices remain high in the market.
For many Nigerians, the situation has added to existing economic challenges, including rising transport costs and inflation. Air travel, which is already expensive for many, could become even less accessible if the crisis is not resolved.
The Federal Government’s intervention is seen as a step in the right direction, but stakeholders say sustained efforts will be needed to stabilise the sector.
As discussions continue, attention will be on how quickly the proposed measures are implemented and whether they will provide lasting relief for airlines and passengers alike.
For now, the suspension of the planned shutdown offers a temporary solution, while both government and industry players work towards a more permanent fix to the aviation fuel crisis.