LPG price up by Rs1.57/kg for this month

ISLAMABAD: The caretaker government Monday increased the price of a domestic 11.8-kilogramme liquefied petroleum gas (LPG) cylinder by Rs18.52 for January 2024, as per a notification from the Oil and Gas Regulatory Authority (Ogra).

The LPG prices have witnessed an increase of Rs1.57/kg, rising from Rs254.86/kg in December to Rs256.43/kg in January. In a statement, the regulator said: “The LPG producer price is linked with the Saudi Aramco-CP and US dollar exchange rates.

Compared to the previous month, the Saudi Aramco-CP has increased by 1.6%. The average dollar exchange rate has, however, gone down by 0.86%, resulting in an increase in the LPG consumer price by Rs18.52/11.8 kg cylinder. The per kg increase in LPG consumer price is Rs1.56.” The revised pricing will have varying impacts on different cylinder sizes. Following the hike, the price of a domestic cylinder will increase by Rs18.52/11.8kg from Rs3007.35 in December to Rs3025.87/11.8kg in January. The price of a 45.4kg commercial cylinder will go up by Rs71.278.

Ogra has determined the producer price of LPG, assuming a composition of 40 percent propane and 60 percent butane, to be Rs177,644.20 per tonne. This price includes an excise duty of Rs85 per tonne, excluding the petroleum levy of Rs4,669 per tonne. Consequently, the total cost for an 11.8 kg cylinder amounts to Rs2,096.20/11.8kg cylinder.

Before the imposition of an 18 percent general sales tax (GST), the producer price would have been Rs182,313.20 per tonne, resulting in a price of Rs 2,151.30/11.8kg cylinder. The GST on Rs180,983.47 per tonne would have been Rs32,816.38 per tonne or Rs387.23 per 11.8 kg cylinder.

The Ogra has further calculated a maximum producer price of Rs215,129.58 per tonne or Rs2,538.53 per 11.8kg cylinder. The marketing, distribution, and transportation margins have been set at Rs35,000 per tonne, comprising a marketing margin of Rs17,000 per tonne, a distribution margin of Rs10,000 per tonne, and a transportation margin of Rs8,000 per tonne, resulting in a total margin of Rs413 per cylinder.

Additionally, consumers are taxed with an 18 percent GST of Rs6,300 per tonne or Rs74.34 per 11.8kg cylinder, on the marketing and distribution margin of Rs35,000 per tonne.

It is noteworthy that the caretaker government had increased the price of LPG by Rs39 per kg (19.37 percent) for September. In October, the government had raised the prices by 8.7 percent or Rs20.86 per kg.

However, for November, the prices were reduced by Rs9.95 per kg, and for December, the interim government had increased the price of LPG by Rs3.83 per kg.