LPG gets costlier from today as Ogra raises November price, while open-market rates run far above the official rate
Pakistan's oil and gas regulator has raised the official liquefied petroleum gas price by Rs14.73 a kilogramme for November, taking a standard 11.8-kilogramme household cylinder to Rs3,470, even as LPG sells for far more in the open market amid a supply shortage.
Households across Pakistan will pay more for liquefied petroleum gas (LPG) from today, 1 November, after the Oil and Gas Regulatory Authority (Ogra) notified a fresh increase for the month. The regulator has raised the consumer price by Rs14.73 a kilogramme, setting the official rate at Rs294.07 a kilogramme and taking the price of a standard 11.8-kilogramme domestic cylinder to Rs3,470.09, up by Rs173.86 from Rs3,296.23 in October.
The notification, issued on Saturday, puts the producer price at Rs294,075 a tonne for November, compared with Rs279,341 a tonne in October. Ogra links the monthly LPG price to Saudi Aramco's contract price and the dollar exchange rate, and said the Aramco benchmark had risen by 6.47 per cent over the month while the average dollar rate had eased slightly, by 0.12 per cent, producing the net increase of Rs14.73 a kilogramme. A larger 45.4-kilogramme commercial cylinder will also cost more, rising by Rs669 to Rs13,351.
For many consumers, however, the official rate is not the price they actually pay. Reports from Saturday put open-market LPG at up to Rs630 a kilogramme in some places, more than double the notified rate, while company-operated franchises were reported to be charging up to Rs400 a kilogramme. City-level reports varied widely, with Lahore around Rs520, Karachi around Rs530 and Peshawar around Rs570 a kilogramme, underlining how far street prices have drifted from the regulator's figure in different parts of the country.
The increase lands hardest on households that depend on LPG for cooking, especially in areas without piped natural gas and among lower-income families for whom a cylinder is a basic monthly expense. With winter approaching, demand for LPG typically rises sharply, and the new rates mean refill bills will be higher just as colder weather increases consumption. Businesses that use LPG for cooking and heating, including restaurants and small food outlets, will also face higher costs from the commercial cylinder increase.
Behind the price gap sits a supply squeeze. The LPG Distributors Association of Pakistan has warned that the situation is serious because of the closure of the Iranian border, with its chairman, Irfan Khokhar, saying at least 70 per cent of Pakistan's LPG is imported from Iran while only about 30 per cent is produced locally. The shortage has been linked to disruption caused by the US-Iran war, and distributors have warned that the crisis could deepen as the gas shortage compounds in the weeks ahead.
The strain is part of a wider winter energy crunch. Pakistan is already facing pressure on natural gas supplies, with QatarEnergy extending its force majeure on liquefied natural gas deliveries until the end of December, limiting the government's options for securing alternative cargoes at a time when household gas consumption traditionally peaks. Against that background, LPG has become an even more important fallback fuel, which makes its scarcity and price all the more sensitive for consumers.
The industry is also in dispute with the government over the future shape of LPG policy. LPG marketing companies have threatened to shut down their businesses from 16 November if the private sector is sidelined in the upcoming policy, with the Pakistan LPG Marketers Association warning of a strike from that date if the policy goes ahead in its current form. Distributors, for their part, have accused some companies of charging inflated rates and profiteering from the shortage, a charge that points to enforcement as well as supply as a factor in what households pay.
State-owned importers are waiting on a separate decision that could affect supplies. Pakistan State Oil, Pak-Arab Refinery Company and SSGC LPG have been awaiting revisions to the government's LPG pricing formula before proceeding with imports, arguing that higher international prices and spot-market premiums have made purchases commercially unviable under the current rates. A revised formula, prepared in consultation with industry representatives, is expected to be put to the prime minister for approval, and the companies have said they intend to begin imports once a workable mechanism is in place.
Ogra's pricing structure itself includes a substantial tax component. According to the regulator's breakdown, the price includes a petroleum levy of Rs4,669 a tonne and goods and services tax of Rs38,559 a tonne, with further tax on marketing, distribution and transportation margins. Those charges help explain why the regulated price moves the way it does, but they do little to close the gap between the notified rate and the price charged at the shop counter, where enforcement of official rates remains uneven.
What happens next will depend on three dates now in view. The November rates apply from today, so households will see the higher refill price immediately. A decision on the revised import pricing formula could ease or prolong the supply shortage, depending on when it is approved and whether imports resume quickly. And 16 November is the date marketers have set for their threatened shutdown, which would test whether the government and the industry can agree on a policy that keeps LPG flowing without pushing prices further out of reach. For now, consumers face a winter in which the official price has risen, the market price is higher still, and supply remains uncertain.
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