CNG prices cut by Rs9 per kg in Punjab, Islamabad

Fall comes due to coronavirus crisis, dip in global oil prices

ISLAMABAD: Compressed natural gas (CNG) consumers in Punjab and Islamabad will enjoy a major relief as filling stations have announced a reduction of Rs9 per kg in CNG prices with immediate effect keeping in view the coronavirus crisis and the dip in global crude oil prices.

CNG consumers in Punjab and Islamabad have been receiving imported gas for the past several months due to shortage of locally produced gas. However, CNG consumers in other provinces are consuming the natural gas produced by the respective provinces.

Recently, energy prices have crashed in the international market in the wake of rapid spread of deadly coronavirus, which has caused a slump in consumer demand.

Pakistan government has announced a reduction of Rs15 per litre in oil prices amid falling demand for petroleum production that has caused the shutdown of some oil refining plants.

Following the move, the CNG industry also slashed prices on Friday. This industry uses imported gas - liquefied natural gas (LNG) - in Punjab and is likely to reduce prices further when the plunging global oil and gas prices have an impact on Pakistan.

A major supplier of LNG is Qatar which exports 500 million cubic feet per day (mmcfd) to Pakistan.

All Pakistan CNG Association Central Chairman Ghiyas Paracha, in a statement, said the CNG retail price in Punjab and Islamabad had been reduced and the new rate would be around Rs84.5 per kg.

"The decision has been taken in view of the crisis situation and decline in global oil prices," he said.

"Re-gasified LNG price is based on a three-month average price of Brent crude, which is to be transferred to us on April 1 but we have taken this step earlier to facilitate our customers during the current crisis."

Paracha voiced hope that prices would be slashed further on April 1 if the situation permitted the industry.

"We are also working with the government for a reduction in CNG prices in Khyber-Pakhtunkhwa, Sindh and Balochistan and hopefully, it will be announced for those gas users as well," he said.

Published in The Express Tribune, March 28^th, 2020.

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