KARACHI, Oct 2: The skyrocketing oil prices have prompted the rates of compressed natural gas kits to jump by 65 per cent, a survey of the market by Dawn shows.
The upsurge in the prices of CNG kits came during the past one month as people thronged CNG shops to have kits installed in their vehicles in an attempt to ward off the impact of rising petrol prices.
A CNG kit with 55 kilograms of cylinder was available for Rs27,000 to 29,000 a month ago and now its price has gone up to Rs42,000. Market sources say the supply of cylinders has run short and the demand has been on the rise. They charge that the distributors have held the supply to multiply their profits.
A retailer of CNG kits near the Jail Chowrangi, Waleed Khan, said on Sunday that the prices of installation of a 50kg cylinder with CNG kit cost Rs32,000 while 55kg cylinder with kit cost around Rs41,000 to Rs42,000. He said the retailers could hardly meet the demand of consumers as they were unable to get cylinders from importers.
He said the supply was not up to the mark. “There is no dearth for CNG kits in the market and their prices have gone down slightly which ranges between Rs5,600 to Rs9,300 but the prices of cylinders have gone up significantly. If the cylinder prices come down, the installation prices with kits would automatically decrease,” he added.
Mr Khan said no additional levy had been imposed by the government on the import or sale of CNG kits and cylinders. “We get the material at exorbitant rates and have to sell to consumers at high prices as we are compelled to do so,” he added.
A major supplier of CNG kits and cylinders, Abu Bakar told Dawn over the telephone on Sunday that the oil prices had increased in the international market and it had put an impact on all industries. The raw material became expensive and their manufacturing cost had increased. Earlier a 50kg cylinder was available at $100 (Rs6,045) and now it was being imported at $350 (Rs21,157). The prices of 40kg cylinders were also the same. However, the 55kg cylinder had been imported at $150 (Rs9,000) and now it was available at $450 (Rs27,200).
Mr Abu Bakar said the demand for CNG kits and cylinders had increased and the suppliers were facing difficulty in meeting it. He said the demand for CNG kits and cylinders on an average was 20,000 daily in the country while the supply was 8,000 to 10,000 cylinders daily. “The demand is higher than supply, which has had an impact on prices,” he added.
He was of the view that in the near future the prices for installation of CNG kits would not go down.
