LPG prices at record high, producers pass on tax to consumers

Producers of liquefied petroleum gas (LPG) have shifted the burden of levy on LPG to the 60 million consumers, raising its prices by Rs15,850 to a record Rs109,700 per ton Friday. Chairman of FPCCI Standing Committee on LPG and All Pakistan LPG Distributors Association (APLDA) Abdul Hadi Khan, while expressing his disappointment over this rise, said the rise of Rs15,850 included the levy of Rs11,400 per ton on LPG, which meant for producers and not consumers. This has enhanced domestic prices by Rs15 to Rs145-165 per kilo, 11.8 kilo cylinder by Rs188 to Rs1,652 and 45.4 kg cylinder by Rs726 to Rs6,356, he added.
He vehemently criticised the government for not stopping the producers from passing on LPG levy to consumers, thus raising its prices to the highest ever in country’s history. This will have a negative impact on LPG sales and making this fuel out of the reach of common consumers, he observed. Hadi alleged that the government has let local producers to raise LPG price at their own will to drop a price bomb on the consumers who were already burdened with unprecedented price hike in the country. Hadi said that he has convened an emergency meeting of over 6,000 distributors and other stakeholders to devise a line of action against this price rise and transfer of LPG levy to consumers. He further alleged that local producers have reduced the daily production to 1,100 to 1,200 ton since last seven months, while some producers were planning to go for production shut down in the mid of March to further shrink LPG production to 600 to 700. “This will enable the non-representative stakeholders to take advantage of big gap between the demand and supply of LPG and resort to profiteering”, he noted. Hadi urged the Petroleum Minister to take effective measures to bring down LPG prices to a reasonable level and provide relief to 60 million consumers and save jobs of thousands of people attached to this industry. He said local production cost of LPG was Rs13,000 to Rs14,000 per ton while it was being sold at Rs109,700 per ton. He underlined the need for developing a price mechanism to bring down LPG price in the country and enforce government’s writ to save this sector from collapse.