{
  "id": 2180356,
  "title": "Rising LPG prices push Karachi tea cafes back to coal",
  "url": "https://urgent.news/2026/08/20/rising-lpg-prices-push-karachi-tea-cafes-back-to-coal",
  "topic": "business",
  "section": "Business",
  "published": "2026-08-20T16:56:18.000Z",
  "source": {
    "name": "Business Recorder",
    "slug": "business-recorder",
    "url": "https://www.brecorder.com/news/40435785/rising-lpg-prices-push-karachi-tea-cafes-back-to-coal"
  },
  "original_language": "en",
  "account": "Recent surges in Liquefied Petroleum Gas (LPG) prices have compelled numerous tea cafes in Karachi to revert to using coal as a more cost-effective fuel. As businesses face mounting fuel expenses and fierce competition that limits their capacity to raise prices, many have opted for coal, finding it a cheaper alternative. Abdul Raheem, a cafe owner in Gulshan-e-Iqbal, expressed difficulty in sustaining his business due to the continuous rise in LPG costs, leading him to switch to coal. The Iran-US conflict has significantly contributed to the volatility in the LPG market, with energy supply disruptions and shipping issues through the Strait of Hormuz further driving up regional energy costs. In response to these price increases, OGRA raised LPG prices in August 2026 by Rs12.89 per kilogram, raising the cost of an 11.8kg domestic cylinder from Rs241,432.84 to Rs254,315.35. Raheem shared that while coal may not have been as popular in the past, the current high LPG prices have made it a necessity for many cafes. He noted substantial savings in fuel costs, with an 11.8kg cylinder of coal costing approximately Rs5,000, translating to monthly savings of around Rs54,000. Another cafe owner in the Buffer Zone area, Rahmatullah, cited intense competition as a primary factor that prevented businesses from raising prices. He emphasized that reducing costs is crucial for improving profitability, and switching to coal is a practical way to achieve this. Fuel costs have been rising faster than menu prices, leaving small food businesses with limited options to absorb the shock. Energy expert Usama Khan highlighted the impact of these rising fuel costs on small businesses, mentioning that many are coping with lower profit margins, reduced portion sizes, and, in some cases, subtle staff reductions. The increase in LPG prices is also attributed to black marketing, the lack of LPG filling stations, and the flawed LPG pricing formula introduced in 2018. The chairman of the LPG Distributors Association, Irfan Khokhar, urged the government to revise the pricing formula, claiming that the country is highly vulnerable to external energy shocks and that more than 40% of its primary energy needs are met through imports. Improving energy security and reducing the current account deficit would benefit from accelerating the substitution of imported coal with Thar lignite, a move that could save around $2 billion annually.",
  "summary": "Rising Liquefied Petroleum Gas (LPG) prices are prompting tea cafes across Karachi to switch back to coal, as businesses grapple with soaring fuel costs and intense competition that limits their ability to raise prices. A Business Recorder survey found that dozens of tea cafes across Karachi, including in Gulistan-e-Johar, North Karachi, and Federal B Area, have switched to coal as a cheaper…",
  "key_points": [
    "LPG price surge forces Karachi cafes to switch back to coal",
    "Iran-US conflict and supply disruptions drive up LPG costs",
    "Coal cylinders cost ~Rs5,000, saving cafes ~Rs54,000 monthly"
  ],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}