LPG industry demands correction in Ogra’s pricing formula

LAHORE: The All Pakistan LPG Industry Organising Committee has warned that immediate correction in Oil and Gas Regulatory Authority (Ogra) notified gas price and restoration of transportation through Balochistan are urgently needed to ensure adequate supply when seasonal demand picks up from mid-August.

The committee cautioned that any further delay could plunge the country into a severe LPG shortage and price spiral. In a statement issued on Tuesday, the committee’s central leader Khawaja Nouman Ahmed said the concerns about looming crisis were already raised. Participants at the conference flagged multiple issues, including what they termed Ogra’s flawed determination of cooking gas prices and other structural problems hurting the industry.

Following the conference, a 20-member delegation of industry representatives met with Ogra’s senior management as well as senior officials of the Petroleum Division, Ministry of Energy to discuss the sector’s demands. Ahmed described the engagement with government officials as a welcome development, but stressed that dialogue must now translate into concrete action.

He said the most pressing issue is a fresh assessment of Ogra’s notified LPG price. According to the committee, the current formula does not accurately account for the cost of imported LPG and other associated expenses, leaving the industry unable to operate sustainably. At the same time, Ahmed emphasised that law and order challenges affecting the transportation of LPG, particularly through Balochistan, must be resolved on a priority basis.

The committee argued that addressing both pricing and security issues would have multiple benefits. It would bring stability to LPG prices, improve overall supply, and allow plant owners, distributors and other businesses linked to the LPG sector to operate without facing what it called “unnecessary raids and fines.”

More importantly, Ahmed said, improved supply would directly benefit consumers by helping to bring prices down. Highlighting the current supply situation, Ahmed noted that LPG stocks in the country have already dropped to their lowest level. He attributed the pressure to the ongoing conflict in the Strait of Hormuz and other disruptions that have affected imports.

He further explained that the LPG industry has a long-standing practice of building stocks during the summer months, when demand is low, to prepare for the winter season. However, this year unfavourable market conditions and what he described as non-conducive government policies have resulted in imports remaining negligible. As a result, the sector has not been able to create the usual buffer stock ahead of the high-demand period.

Given these circumstances, Khawaja Nouman Ahmed urged the authorities to treat the matter with urgency. He called for an immediate revision of the official LPG price to reflect real import costs, and for concrete steps to secure highways and restore the supply route via Balochistan. He said these measures are essential to enable the industry to carry out timely imports and maintain smooth operations.

“With mid-August marking the start of the season and demand set to rise, we are running out of time,” Ahmed said. “If the government does not act now on price correction and supply security, the country faces a serious risk of an LPG shortage crisis, which will hit domestic consumers the hardest.”

The committee chairman reiterated his commitment to working with the government to ensure energy security, but stressed that without policy corrections and a safe supply chain, the LPG sector will not be able to meet the country’s winter requirements.

Copyright Business Recorder, 2026