ISLAMABAD: The government has directed federal and provincial authorities to take coordinated action against the alleged hoarding of liquefied petroleum gas (LPG) to create an artificial shortage ahead of winter, as market prices have reportedly surged nearly 50 per cent above the official rate.
The Oil and Gas Regulatory Authority (Ogra) has also been asked to coordinate with provincial governments and relevant federal agencies responsible for port operations and clearance to ensure the timely lifting and supply of LPG.
The move follows reports that an 11.8-kilogram domestic LPG cylinder is being sold for around Rs5,000, compared with Ogra’s notified price of Rs3,296.
In a letter to the Ogra chairman and director general of LPG, the Petroleum Division noted that importers were bringing in LPG broadly in line with domestic demand, but imported consignments were reportedly not being lifted regularly from import terminals. This has raised concerns about possible hoarding and the creation of an artificial shortage in the domestic market.
According to the Petroleum Division, the situation has contributed to higher prices, particularly in hilly, remote and off-grid areas where households rely heavily on LPG to meet their energy needs.
The division urged Ogra to take corrective measures to prevent hoarding, ensure regular lifting of supplies from import terminals and maintain distribution to demand centres. It also called for enforcement action to ensure that consumers receive LPG at officially notified prices, particularly in vulnerable and underserved areas.
In a separate statement, the Petroleum Division said the government was closely monitoring the situation and remained committed to improving LPG market transparency and competition.
A key priority is the introduction of a transparent, competitive mechanism for disposing of locally produced LPG, which the government believes could address market concentration and create a level playing field for industry participants.
The proposed mechanism would seek to ensure the availability of locally produced LPG in far-flung and hilly areas in accordance with the LPG Policy 2016. It is also intended to promote fair competition, improve transparency in product allocation and provide upstream companies with a fair return on their resources.
The division maintained that the benefits of domestically produced LPG should be accessible to a wider range of market participants rather than remaining concentrated among a limited number of companies.
However, implementation of the proposed mechanism has been delayed by litigation. The government said the matter was being pursued through the courts and reserved the right to exercise all available legal options in accordance with the law.
The Petroleum Division reiterated its commitment to improving market efficiency, promoting a fair and transparent business environment, and protecting consumers from artificial shortages and excessive prices ahead of the winter season.
Story by Khaleeq Kiani
