06 November 2004	Saturday	22 Ramazan 1425

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KARACHI, Nov 5: Price of liquefied petroleum gas (LPG) has again come under pressure, rising to Rs48-50 from Rs42-43 per kg in just two days, thus adding sufferings of the poor consumers.

In October, LPG price had dropped to Rs37-38 per kg after the government's decision of slashing the 11.8 kg cylinder price by Rs95. However, the rate again reverted to the older higher levels on October 11 at Rs42-43 per kg.

Marketing companies and distributors have been dilly-dallying in revealing the actual reason behind the meteoric rise in LPG prices. Both the market forces are not ready to take the onus of this frequent price hike.

Meanwhile, retailers are also not ready to take the brunt of price hike saying that they are getting LPG at higher rates from distributors. Market sources say that there is a possibility of gas hoarding by some market forces in order to reap a better windfall when demand remains high in November, December and January due to winter season.

Refinery officials expressed surprise over the increase at a time when all the producers had not reduced the prices. Instead they said that they had reduced the rates to Rs17,000 from Rs24,000 per ton on Prime Minister Shaukat Aziz's intervention. Since then the producers had not made any upward change in the prices.

Market people say that there was no justification of raising the prices on the pretext that the imported LPG had been costing more when the country's entire consumption depended on the 90 per cent production from local refineries and gas fields.

LPG Distributors and Welfare Association (LPGDWA) President Hadi Khan again adopted a face saving technique by attributing the price hike to the arrival of costly imported gas.

He said that the demand of LPG in Karachi ranges between 250-300 tons per day but the city gets only 60-70 tons from National Refinery Limited (NRL) and Pakistan Refinery Limited (PRL).

He also claimed that LPG price had also gone up in upcountry on account of rising demand in the winter season. A major portion of PARCO's 450 tons production was being consumed in northern areas due to rising demand in winterseason. In such circumstances the dependence on imported gas was on rise in Karachi, he added.

He said that the 11.8 kg cylinder of imported gas now costs Rs505-525 as compared to Rs475 few days back. He defended the price hike by saying that the major chunk of the imported LPG is being consumed in the city. The local production of 1,000 tons per day was certainly not enough to cope up with the rising demand arising out from the cold wave in northern areas.

He again urged the government to withdraw various levies and taxes on import of LPG so that consumers could get cheaper gas at a time when demand is fast outstripping supply in interior parts of the country and northern areas in winter season.

Duty cut on import of LPG will bring down the price of gas to Rs410-430 per cylinder. Currently there is a disparity in prices of imported gas and locally produced gas, he added. Mr Hadi said that Karachi market is facing acute shortage of gas these days as supplies from Punjab has also been suspended due to rising demand in winter.

Marketing companies had already suggested the government in October for temporary waiver of general sales tax and customs duty on the import of LPG in order to bridge the demand and supply gap of 10,000 tons of gas for the next three months.

Taxi and rickshaw owners, who illegally use LPG as an alternative fuel against petrol for saving the running cost of vehicles, are demanding higher fares from the consumers due to increase in gas rate.