LPG goes cheaper than petrol, diesel

LAHORE – State-owned LPG producer Oil & Gas Development Company Limited (OGDCL) has reduced its base stock price of LPG for the third time this month to Rs 58,000 per ton (exclusive of duties and taxes).The latest price reduction of Rs 7,000 per ton came in the wake of piles of unsold stock and a mounting domestic production which is up by 25 per cent since the start of the year. The current producer price is $225 or Rs 20,000 per ton below the Saudi Aramco Contract Price with which LPG prices have remained indexed. The drastic reduction in price is effectively a de-linkage from the international price benchmark and augurs well for the LPG Industry as the product has become cheaper than petrol, diesel. The revised price of LPG companies for their distributors will be Rs 970 for domestic and Rs. 3,732 for commercial cylinders. Similarly distributor price for consumers will be Rs 1,125 for domestic and Rs 4,320 for commercial cylinders. Retail prices in different parts of the country are expected to be as follows; Sindh and Balochistan Rs 90 per kilo, Punjab Rs 95 per kilo, Khyber Pakhtunkhwa Rs 100 per kilo, AJK Rs 105 per kilo and Northern Areas Rs  115 per kilo. “LPG demand typically begins to slacken with the onset of summer. However this year demand has also been affected by an over supply of product both locally and from cheap and under invoiced Iranian imports” said Belal Jabbar, the spokesman for the LPG Association of Pakistan (LPGAP). He said: “In light of the increasing domestic production which has made imports altogether redundant, we urge the Federal Minister Dr Asim Hussain to immediately notify delinking of LPG producer prices from Saudi Aramco CP as this will keep the product affordable for the common man.”