‘Marketing companies not responsible for LPG price hike’

LAHORE: The LPG Association of Pakistan (LPGAP) has said that the marketing companies are not responsible for LPG price hike, as is being rumoured by some vested quarters.

A spokesman for the LPG Association of Pakistan said numerous factors are responsible for the increase in LPG prices.

Substantial profiteering by importers of LPG, governments reluctance to bring locally-produced LPG prices to low level and dealers are mainly responsible for this surge in prices.

The business of LPG supply is conducted by marketing companies as a social service to the community, in areas where the national gas transmission companies has failed to provide piped natural gas.

He said not allowing free use of LPG as an alternative fuel for commercial transport vehicles, the government has increased dependence on costly imported fuels, besides creating pollution in major cities. Burden on the national exchequer of unwanted imports must also be of concern for the Ministry of Finance.

The LPGAP spokesman said that the huge investment has been made in the LPG sector of Pakistan by the private sector, which needs to be protected by favourable policies of the government.

Today, most of the LPG marketing companies are facing tremendous financial pressure because of unjustified glut in imports of low quality LPG because of the Ministry of Petroleum and Natural Resources and Ogra’s silence towards importers.

Setting local LPG price at high under present circumstances, it has became very difficult for the LPG marketing companies to run their businesses, as they had suffered huge financial losses during the last many months, he said. Closure of marketing companies businesses would not only be a big blow to the huge investment, but thousands of families would be deprived of their livelihood, the spokesman said.  He also said that there is a dire need to come out with a rationalised approach for the local LPG industry.

The Ministry of Petroleum and Natural Resources and Ogra should implement the new LPG policy as announced by them some months ago.

The high cost of local LPG, non-implementation of new LPG policy and continuous violation of Ogra rules by importers and some LPG marketing companies and dealers has pushed the marketing companies towards closure by putting their huge investment at stake, the LPGAP spokesman added.