ISLAMABAD: Caretaker Prime Minister of Mohammed Mian Soomro gave approval in principle for complete de-regulation of prices of LPG and directed OGRA to separate the price of LPG from the Saudi Aramco control price.
Mohammed Mian Soomror was chairing a high-level meeting to review the LPG pricing policy here at the PM Secretariat. The prime minister said that the interest of the consumer has to be given highest priority, therefore it would be better if the price of such a commodity of daily use is driven by market forces of demand and supply rather than notification by the government.
He directed OGRA to monitor the supply and prices of LPG to ensure continuous supply of LPG in remote areas at affordable prices. Secretary petroleum and natural resources told the meeting that LPG’s share in the country’s energy consumption has increased from 0.4 per cent last year to 0.5 per cent this year. He said 92 per cent of LPG consumed in the country is domestically produced. He also said that 1.5 million households are using LPG fuel for cooking and heating purposes, while the main user of this type of fuel is the automobile sector.
The LPG Distributors Association of Pakistan has withdrawn its strike call, which was scheduled to be observed in the country on Dec 3, our staff reporter adds from Karachi.
The announcement came after a meeting reviewed the LPG pricing formula on Friday and approved to de-link the local LPG price from the Saudi Aramco pricing formula. Caretaker Prime Minister Muhammadmian Soomro chaired the meeting in Islamabad.
Abdul Hadi Khan, chairman of the LPG Distributors Association who is also senior vice-chairman of the FPCCI Standing Committee on Petroleum & Gas, welcomed the changes made in the LPG pricing formula together with de-linking of the locally produced LPG price from Saudi Aramco formula.
He said the government’s decision would help arrest the prices in of LPG in the local market. He informed that Muhammadmian Soomro had also conveyed these changes in the gas pricing formula to the Oil and Gas Regulatory Authority (OGRA) in an official communique.
Now the lmarkets forces would determine LPG prices, Khan added. He said the government’s decision would benefit consumers. There were more than 1.5 million domestic consumers of LPG, and hundreds of thousands of taxis and rickshaws use LPG which was cheaper than other fuels, he added.
Due to the linking of local LPG prices with the Saudi Aramco pricing formula, the rates of gas in the local market have increased phenomenally, and its use could record just a fractional rise of 0.1 per cent in the country during this year. This marginal rise in gas use was to the detriment of those in the LPG distribution business, he said.
Khan suggested Soomro to reduce the locally produced LPG pricees.
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