The price of Liquefied Petroleum Gas (LPG) has registered an increase of Rs 19 per kg following the increase in Saudi Aramco Contract Price of LPG for August by $173 per ton. The Saudi Aramco announced on Tuesday an increase of $173 per ton in the price of the commodity from $602 to $775 for both propane and butane.
The LPG producer prices, which are indexed to the Saudi Aramco CP, will therefore increase by Rs 19,000 from Rs 66,010 to Rs 85,010 per ton. The impact of this escalation will result in an increase of Rs 223 for domestic cylinder and Rs 860 for commercial cylinder. Average LPG retail prices are expected to be as follows; Sindh and Balochistan Rs 115 per kg; Punjab Rs 125 per kg, KP and AJK Rs 130 per kg and Northern Areas Rs 140 per kg.
According to Bilal Jabbar, spokesman of LPG Marketing Companies, LPG retail prices would increase by Rs 19 per kg following the increase in Saudi Aramco Contract Price. The sharp escalation is due to an increase in the price of oil and increased demand for LPG from China and other energy hungry countries, he said.
It may be mentioned here that the Oil and Gas Regulatory Authority (OGRA) is responsible to fix LPG prices, but the authority has not issued any notification in this connection. After the current increase in the LPG prices, the product will be sold at Rs 135 per kg in hilly areas like Murree, Muzafarabad, Gilgit-Baltistan (GB) Mansehra, Federally Administrative Tribal Areas (FATA) and Balakot, while in plain areas including Karachi, Lahore, Faisalabad, Sargodha, Rawalpindi, Islamabad, Gujranwala, Gujrat, Rahimyar Khan, Multan, Attock, Dera Ismail Khan and Peshawar, the commodity would be sold ranging between Rs 118 per kg to Rs 125 per kg.
According to energy experts, LPG accounts for only one percent of Pakistan's total energy mix with its current total demand stands at 1,700 tons per day, while local production is about 1,200 per day. As per law the LPG marketing companies are bound to import 20 percent of their total quota, but due to high prices and other local rifts the marketing companies are not interested in importing the commodity.