The Dawn reported that retail price of the liquefied petroleum gas is expected to go up by PKR 9 per kilo following a sharp increase in Saudi Aramco Contract Price for February.

Mr Belal Jabbar spokesman of the LPG Association of Pakistan said that “The impact of this escalation will result in an increase of PKR 106 for the domestic and PKR 408 for commercial cylinders while the retail price is expected to increase up to PKR 155 per kilo.”

Tensions in the Middle East and Persian Gulf led to a hike in oil prices bringing the spot prices for both Propane and Butane to alarming levels of USD 940 per tonne and USD 990 per tonne respectively.

“The applicable price in Pakistan is calculated on 40:60 propane to butane ratio. The Saudi Aramco CP due to be announced on January 30th 2012 will be the highest ever. The increase will ultimately be borne by the consumers as the sale price for domestic and commercial cylinders will increase from PKR 1,650 to PKR 1,756 and PKR 6,350 to PKR 6,758, respectively.

Mr Belal Jabbar said that “We urge the government to seriously reconsider the imposition of petroleum levy on LPG which will only make the situation worse for the consumers.”

The government had on Jan 16 imposed a petroleum levy of PKR 11,486 per ton on LPG production to increase its price and equate it with that of the imported one. However, in order to avoid criticism and public backlash, state owned LPG producers, on the directions of the ministry, reduced their prices by PKR 10,000 per ton before adding the levy of PKR 11,486 and the resultant increase in prices was PKR 1,486 per tonne.

(Sourced from www.dawn.com)