ISLAMABAD - The caretaker government, for the fifth time since its inception, has jacked up the price of liquefied petroleum gas (LPG). The price of domestic cylinder of 11.8 kilogramme has been raised by Rs13.76 for the month of February 2024. As per the notification issued by Oil and Gas Regulatory Authority (Ogra), the price of liquefied petroleum gas (LPG) has been raised by Rs 1.17 per kg, from Rs256.43 per kg in January to Rs257.60 during February. The LPG producer price is linked with Saudi Aramco-CP and US$ dollar exchange rate. As compared to previous month Saudi Aramco-CP has increased by 1.6%. The average dollar exchange rate has however gone down by 1% resulting to increase in LPG consumer price by Rs.13.76/11.8 kg cylinder (0.45%), said Ogra. The per kg increase in LPG consumer price is Rs.1.17, it added.
It is worth noting that the Ogra’s determination is just a formality as the LPG companies and retailers are selling the LPG to consumers at Rs 280 to Rs 320 per kg, which is more than 20 percent higher than the official notified price of the commodity. The revised pricing will have varying impacts on different cylinder sizes. After hike, the price of domestic cylinder will go up by Rs 13.76/11.8 kg from Rs 3025.87/11.8kg in January to Rs 3039.63/11.8kg. While the price of 45.4kg commercial cylinder will go up by Rs 53.118. The commercial cylinder price will go up to over Rs 11695 from the previous Rs 11642. Ogra has determined the producer price of LPG, assuming a composition of 40 percent propane and 60 percent butane, to be Rs178,632.46 per ton. This price incorporates an excise duty of Rs85 per ton, excluding the petroleum levy of Rs4,669 per ton. Consequently, the total cost for an 11.8 kg cylinder amounts to Rs2,107.86/11.8kg cylinder. Before the imposition of an 18 percent general sales tax (GST), the producer price would have been Rs183,301.46 per ton, resulting in a price of Rs 2,162.96/11.8kg cylinder. The GST on Rs183,301.46 per ton would have been Rs32,994.26 per ton or Rs389.33 per 11.8 kg cylinder. Furthermore, Ogra has calculated a maximum producer price of Rs 216,295.72 per ton or Rs 2,552.29 per 11.8 kg cylinder. The marketing, distribution, and transportation margin has been set at Rs35,000 per ton, comprising a marketing margin of Rs17,000 per ton, distribution margin of Rs10,000 per ton, and transportation margin of Rs8,000 per ton, resulting in a total margin of Rs413 per cylinder. Additionally, consumers are taxed with an 18 percent GST of Rs 6,300 per ton or Rs74.34 per 11.8 kg cylinder on the marketing and distribution margin of Rs35,000 per ton. It is worth noting that since its inception the caretaker government has five times increased the prices of LPG, while it was lowered only once. For the month of September, the caretaker government had increased the price of LPG by Rs 39 per kg (19.37 percent). For the month of October also, the govt had jacked up the price of LPG by 8.7 percent or Rs 20.86 per kg. For the month of December also, the interim government had increased the price LPG by Rs 3.83 per kg.