LPG price likely to increase by Rs3.5 per kg

Increase linked to international rates.

KARACHI: The price of liquefied petroleum gas (LPG) is likely to increase by Rs3.5 per kg and Rs3,010 per ton in the country after a rise in the international market, according to Pakistan LPG Distributors Association Chairman Abdul Hadi Khan on Monday.

The increase is expected after a rise of $35 in Saudi Aramco’s contract price to $848 per ton in the international market due to political tension in Arab countries, including Libya.

Khan was of the view that if the local producers keep increasing prices, LPG sales will decline by 10 per cent. Sales have already dropped sharply due to high prices.

He added that the reason for the increase in LPG’s contract price is not only the disturbances in the Middle East, but also the rise in the price of butane, which jumped by $50 to $860 per ton.

LPG sales have been badly affected, despite the chilled weather in upper parts of the country. LPG consumption has declined to 1,400 tons per day, against the normal consumption of 2,200 tons per day.

Khan urged local producers to keep LPG price at the February level, so the comparatively cheaper fuel remains in reach of poor people.

Published in The Express Tribune, March 1^st, 2011.