LPG prices increased by Rs 45.18 per cylinder in December

• The government cites an increase in the dollar’s exchange rate for growth.
• LPG prices rose to Rs 254.86 per kg.
• The price of the commercial cylinder will increase by Rs 173,882.

ISLAMABAD: Citing an increase in the average exchange rate of the dollar, the caretaker government has increased LPG prices by Rs3.83 per kg for commercial and domestic consumers for the month of December. The news mentionted.

The Oil and Gas Regulatory Authority (Ogra) informed that LPG prices have increased to Rs 254.86 per kg from last month’s price of Rs 251.03, affecting various cylinder sizes differently.

According to Ogra, the LPG producer price is linked to the exchange rate of Saudi Aramco-CP and the US dollar, which remained unchanged compared to the previous month. However, the average dollar exchange rate rose by 1.87%, leading to Rs 45.18/11.8 kg cylinder (or 1.5%) in consumer LPG prices.

Following the hike, the price of a domestic cylinder rose by Rs 45.18/11.8 kg, from Rs 2,962.17 in November to Rs 3,007.35. At the same time, the price of a 45.4 kg commercial cylinder will increase by Rs 173,882.

Ogra has fixed the producer price of LPG, assuming a composition of 40% propane and 60% butane, at Rs 176,314.44 per tonne. This price includes excise duty of Rs 85 per tonne, excluding oil levy of Rs 4,669 per tonne.

Consequently, the total cost for an 11.8 kg cylinder comes to Rs 2,080.51. Before the imposition of 18% general sales tax (GST), the producer price would have been Rs 180,983.47 per tonne, resulting in a price of Rs 2,135.60/11.8 kg cylinder. VAT at Rs 180,983.47 per tonne would be Rs 32,577.02 per tonne or Rs 384.41 per 11.8 kg cylinder.

In addition, OGRA has calculated a maximum producer price of Rs 213,560.49 per tonne or Rs 2,520.01 per 11.8 kg cylinder. Marketing, distribution and transportation margin was set at Rs 35,000 per tonne, comprising marketing margin of Rs 17,000 per tonne, distribution margin of Rs 10,000 per tonne and transportation margin of Rs 8,000 per tonne, resulting in a total margin of Rs 413 per cylinder.

Consumers are also subject to 18% VAT of Rs 6,300 per tonne or Rs 74.34 per 11.8 kg cylinder on the marketing and distribution margin of Rs 35,000 per tonne.

In September, the caretaker government raised the price of LPG by Rs 39 per kg (19.37%) and in October, prices increased by 8.7% or Rs 20.86 per kg. However, in November, prices fell by Rs 9.95/kg.