LPG producers reduce prices despite levy

OGRA fixes maximum consumer price at Rs115 per kg.

ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) has fixed maximum consumer price at Rs115 per kilogramme after imposition of petroleum levy on locally produced liquefied petroleum gas (LPG).

LPG manufacturers – Oil and Gas Development Company (OGDC), Pakistan Petroleum Limited (PPL) and Pak-Arab Refinery Company (Parco) reduced prices by Rs10,000 per ton on Wednesday.

The LPG Association of Pakistan (LPGAP) and the All-Pakistan LPG Distributors Association (APLPGDA) have welcomed the decision of not burdening consumers with the controversial petroleum levy.

State-owned Parco announced a levy-based addition of Rs11,485 per ton to its LPG price on Wednesday morning before withdrawing it hours later, said LPGAP spokesperson Belal Jabbar.

Ogra had earlier directed 11 LPG producers to raise their prices by 16 per cent with effect from September 21.

“We hope that the ministry’s decision is reflective of a deeper change of heart,” said Ali Haider, speaking on behalf of LPG distributors. “For prices to remain stable, we need a consistent, practical and people-friendly policy framework that does not punish the local industry or consumers,” added Haider.

However, there is great wariness in the industry that the levy has been absorbed to bide time and that prices will increase in a week or month, Haider said.

Published in The Express Tribune, September 22^nd,  2011.