KARACHI: The international price (Saudi Aramco Contact Price) of liquefied petroleum gas (LPG) has been declined by $ 124 to $ 869.50 per ton for May 2012, creating hopes for a price cut in the domestic market.
This was stated by the pattern-in-chief of All Pakistan LPG Distributors Association and chairman FPCCI Standing Committee on LPG Abdul Hadi Khan here on Monday.
He said that propane and butane have been slashed by $ 180 and $ 100 per ton, but local producers did not reduce their prices in accordance with international cut.
He, however, hoped that LPG can come under the reach of general consumers with the decline in international price and said that chances have also been brightened for a rise in local sale of LPG upto 70 percent after a long time. This sale was been reduced to 40 percent in the last ten months, forcing about 800 distributors to close down their businesses, he added.
Hadi pointed out that 14,940 tons of LPG was imported in the country in January 2012, and since then no importer has ever entered into any contract for LPG.
He said that due to falling sales of LPG, marketing companies and local producers had slashed prices twice each, bringing down the overall LPG price by 7 percent in the country.
Hadi said this price cut has lifted local sale by only 5 percent, which means that consumers were still reluctant to go for LPG. They are still preferring other fuel options over LPG, he observed.
He suggested the government to devise a policy for a judicious distribution of quota for local LPG production, before promoting LPG in automobile sector.
This should be followed by boosting local production of LPG on the one hand, and introduction of an effective price mechanism on the other, with the consultation of all stake holders for promoting LPG as an economical alternate fuel.
This will help in eliminating the cartels of few selected individuals and groups on the one hand and resolve energy crisis in the country.
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