Local LPG producers rise prices twice in a week

The local Liquefied Petroleum Gas (LPG) producers have increased the commodity price by Rs 5 per kg, Rs 50 per domestic cylinder and Rs 200 per commercial cylinder. According to Mohammad Irfan Khokhar, Chairman LPG Distributors Association, it is the second increase in LPG prices within current week.
He said that local producers including MOL Pakistan, Sui-Southern Gas Company Limited (SSGCL), Pakistan Petroleum Limited (PPL), Pakistan Arab Refining Company (PARCO) and Oil and Gas Development Company Limited (OGDCL), have increased local LPG prices from Rs 38,000 per ton to Rs 44,500 per ton.
The LPG producers have hiked the commodity prices without the approval of the Oil and Gas Regulatory Authority (OGRA) and distributors were compelled to pass on the impact on end consumers.
He said that if OGRA didn't take action against the ever increasing LPG prices and manufacturers of substandard LPG cylinders, LPG distributors will start a sit-in in front of OGRA head office. He complained that Gujranwala-based 400 LPG cylinder manufacturers, producing substandard cylinders, have once again become operational, while the Punjab government instead of taking any action against them is harassing the poor LPG distributors.
He warned that if Punjab police and local magistrates didn't stop harassing LPG distributors, they will close 3,000 shops across Punjab in protest and will suspend supplying LPG to other region.
Pakistan's local LPG production has jumped from 1,200 tons a day to 1,800 tons a day, while imports have also reached all-time high during ongoing year as it has crossed 400,000 tons mark within first 10 months of 2016 over last year's imports of 287,000 tons.
Local LPG production is likely to increase by 15,000 tons per month within next few months as state-owned OGDCL has completed installation of state-of-the-art LPG plant in Kunar Pasaki and LPG production will start from a number of other fields. Khokhar said that auto sector has become largest consumer of LPG in the country, adding that at present, LPG is the cheapest fuel costing Rs 35 per litre against Rs 47 of CNG and Rs 66 of petrol.
Irfan said that Punjab-based closed CNG stations can be made operational on LPG if OGRA grants licences to the owners of these outlets, adding that it will not only reduce burden on foreign reserves but will also help in reducing omission of toxic gases as LPG is environment friendly.
He urged the government to reduce port charges on LPG imports from $32 per ton to $10 per tons as per international standards besides abolishing advance tax of 5.5 on the imports, saying that cumulative impact of these measures will reduce LPG price by Rs 7 per kg.
He said that in 2014, Pakistan imported a total 62,000 tons of LPG which in 2015 jumped to 145,000 tons and in first 10 moths of 2016, the LPG import has crossed 400,000 tons which by the end of year is likely to cross 500,000 tons.