LPG international price up by $13 per ton

The international price (Saudi Armco Contract Price) of liquefied petroleum gas (LPG) has jumped by $13 to $805 per ton for December 2011, raising its import price by Rs 1,144 to Rs 98,000 per ton in the country. This was stated by the chairman of FPCCI standing committee on LPG and chairman of All Pakistan LPG Distributors Association (APLDA) Abdul Hadi Khan here on Wednesday.
He said that domestic price of LPG will be increased by Rs 1.5 to Rs 2 per kilo, by Rs 23 for 11.8 kilo cylinder and by Rs 68 for 45.4 kg cylinder in the country if the local producers also enhanced their price in accordance with Saudi Aramco CP. Hadi urged the local producers not to raise domestic prices in national interest and for the cause of country's LPG industry and said that LPG sale is restricted to 65 to 70 percent in the country. He urged the Ministry of Petroleum and Natural Resources to issue a clear-cut notification for imposing a proposed levy on the LPG producers so that they cannot transfer this burden to consumers who are making huge profits due to lesser cost of LPG production in the country.
Lauding the decision of the Ministry to impose development levy on LPG producers, Hadi said that LPG is the only sector where producers are making income which is higher by manifold than their product cost. He pointed out that if this levy was extended to other segments of the LPG sector, it will be out of reach of common users and result in the creation of few monopolies.
He noted that LPG imports had declined by 45 percent during January to November 2011 due to rise in international price of LPG and imposition of sales tax at import stage. He said that only 28,000 tons LPG was imported during 11 months of 2011 compared to 51,025 tons in the same period of 2010. He noted that LPG users have grown to more than 50 million in the country due to higher prices of petroleum products and it is now consumed by automobiles, commercial and domestic consumers.
He pointed out that local consumption of LPG is around 1,500 to 1,600 per ton per day during the current winter, while its production ranges between 1,100 and 1,200 ton per day. This had touched 2,200 ton per day a few years ago, he added. Hadi said that LPG business has fallen by 60 percent during January-July 2011, as 70 percent of the commercial vehicles have switched to CNG due to high prices of LPG.-PR