PBIF chief expresses concern over LPG prices

Karachi - The Chairman of the Pakistan Businessmen and Intellectuals Forum (PBIF), Mian Zahid Hussain, has expressed worry over LPG prices reaching Rs500–600 per kilogram, significantly higher than the notified October rate of Rs279.34 per kilogram by the Oil and Gas Regulatory Authority (OGRA). Hussain highlighted that Pakistan is already experiencing disruptions in imported LNG supplies due to the ongoing geopolitical crisis.

He emphasized that uninterrupted LNG supplies throughout winter are crucial. When pipeline gas supplies are disrupted, households and commercial consumers often resort to LPG, making shortages and high prices of this alternative fuel a new threat to energy security. Hussain pointed out the substantial difference between the notified and market prices, which necessitates urgent improvements in supply, distribution, and regulatory oversight.

The notified LPG price increased by nearly 8 percent from Rs258.65 per kilogram in September to Rs279.34 in October, while market prices were about 79-114.8 percent above the October notified rate. He stressed that this gap cannot be attributed solely to the monthly price increase and that supply-chain disruptions, import and transportation costs, and margins at various distribution stages should be scrutinized.

Hussain noted that the notified price of an 11.8-kilogram domestic cylinder rose by only Rs244.14, from Rs3,052.09 in September to Rs3,296.23 in October, while the same amount cost between Rs5,900 and Rs7,080 at market rates. This means consumers pay between Rs2,600–3,800 extra per cylinder. Low-income households are particularly affected, as they have to spend this additional amount on food, children's education, or medical treatment.

Furthermore, if the winter consumption increases, the burden will grow even more. According to the Planning Commission's Annual Plan 2025–26, domestic LPG supply during FY2024–25 was 730,000 tonnes, averaging 2,000 tonnes per day, while imports accounted for approximately 67 percent of the total volume. Disruptions along major trading routes, rising international prices, or transportation delays could quickly impact Pakistan's LPG supply chain.

Hussain mentioned that the September 19 suspension of border trade with Iran affected LPG availability, and regional conflicts and risks to maritime transport could also make alternative imports more expensive. OGRA's 2023–24 report indicated that daily LPG sales in Pakistan were around 5,000 tonnes. Hussain urged the relevant authorities to ensure secure clearance of lawful cargo, considering security requirements, and to ensure alternative supplies.

He warned that limited LNG availability would put pressure on industrial production and electricity supply, increasing household and commercial dependence on LPG. However, LPG is becoming increasingly expensive and harder to obtain, leading to higher operating costs for small businesses, which would be passed on through higher food and service prices.

Additionally, increased household spending on cooking and heating fuel would reduce the amount available for other essential purchases, potentially worsening the ongoing energy crisis and inflation, while weakening business activity.