• LPG rates for August increased to Rs254.32 per kg
• Ogra says five spot cargoes had to be procured after no shipment secured from Qatar
• Regulator finally reveals lower prescribed prices for gas utilities, finalised on June 23
• Rs50bn savings from lower gas rates to be used for circular debt adjustment

ISLAMABAD: In a major price shock, Ogra on Friday notified a record 32pc increase in regasified liquefied natural gas (RLNG) prices for August, fixing the rate at $25.83 per mmBtu for Sui Northern Gas Pipelines Limited (SNGPL) and $25.09 per mmBtu for Sui Southern Gas Company Limi­ted (SSGCL), while denying consumers about Rs50bn in savings from lower natural gas rates.

This translates into a retail price of around Rs7,204 per mmBtu.

The revised price is based on five imported LNG cargoes procured from the spot market, as no shipment could be secured from Qatar due to the US war on Iran. This is the biggest-ever increase in RLNG prices in the commodity’s decade-long history.

The latest increase comes on top of around a 15pc rise in RLNG prices last month, when the rate was fixed at $19.52 per mmBtu (Rs5,446 per mmBtu) for SNGPL and $18.63 per mmBtu for SSGCL.

Compared with the February price of $10.45 (Rs2,916) per mmBtu, the RLNG rate for August is around 148pc higher. The sharp increase is expected to significantly raise fuel costs for power generation.

The impact is already visible, as the fuel cost for RLNG-based power generation rose to Rs31 per unit in May, compared with Rs13.72 per unit in April.

Meanwhile, Ogra also notified a 5.4pc (Rs12.89 per kg) increase in liquefied petroleum gas (LPG) prices for August. It fixed the LPG price at Rs254.32 per kg with effect from Aug 1, compared with Rs241.43 per kg in July.

In a belated disclosure, Ogra has revealed that it red­uced the prescribed prices for gas utilities by Rs134 per unit (7.4 per cent), resulting in savings of around Rs50 billion that will be used for circular debt adjustments instead of providing relief to consumers through lower gas prices.

For the first time, the regulator did not upload its prescribed price determination, finalised on June 23 and shared with the government, on its website. Since its inception two decades ago, Ogra has publicly released its determinations while simultaneously sharing them with the government.

In many cases, it also holds press briefings on its prescribed price determinations and the revenue requirements of gas utilities. However, it remained silent on queries for over a month and finally uploaded the determinations on its website this week after some interveners at public hearings raised concerns.

The government has also maintained silence on the matter, although it has already informed the International Monetary Fund (IMF) that consumer-end gas prices would remain unchanged. The savings resulting from lower revenue requirements determined by the regulator for SNGPL and SSGCL would be used to reduce gas sector circular debt, which was last reported at around Rs3.5 trillion, a senior government official confirmed.

As a result, Ogra has yet to notify consumer-end gas rates for the current fiscal year, which are required under the law and the IMF programme to take effect from July 1 every year.

The fresh determinations would allow annual revenue of around Rs817 billion to the two gas utilities during the current fiscal year, including Rs501 billion for SNGPL and Rs315.8bn for SSGCL.

The determinations showed that the prescribed gas price for SNGPL’s revenue requirement was reduced by Rs134 per mmBtu to Rs1,719 for FY2026-27 from Rs1,853 per mmBtu in FY2025-26, resulting in an annual revenue surplus of around Rs46.3bn.

“In exercise of its power under section 8(1) of the Ordinance, the Authority, after taking into consideration points raised by interveners, clarifications provided by the petitioner, scrutiny of the petition and available record, provisionally determines the surplus in estimated revenue requirement for the said year at Rs46.279bn,” Ogra stated.

It added that the surplus amount would be adjusted against previous years’ shortfall in accordance with the Federal Cabinet’s decision of June 30, 2024, which directed that prior-year shortfalls be adjusted to the extent possible during the current financial year.

Accordingly, the regulator determined SNGPL’s estimated revenue requirement, net of revenues, at Rs501.110bn (Rs1,718.96 per mmBtu) for the current fiscal year.

Similarly, the prescribed price for SSGCL’s revenue requirement for FY2026-27 was reduced by Rs86 per mmBtu, resulting in savings of Rs2.5bn. Ogra said it had provisionally determined a surplus of Rs1.421bn in estimated revenue requirement for the year.

The regulator noted that, based on the currently notified prescribed price, an additional recovery of Rs1.073bn was available, leaving Rs2.494bn for adjustment of previous years’ shortfalls in line with the federal cabinet’s June 30, 2024 decision.

Under the decision, the cabinet had directed Ogra to adjust previous years’ shortfalls to the extent of possible surplus during the current financial year. Accordingly, SSGCL’s revenue requirement, net of other revenues, was provisionally determined at Rs315.773bn (Rs1,691.24 per mmBtu) for the current fiscal year, compared with its previous rate of Rs1,777 per unit before June 30, 2026.

It may be noted that SSGCL had sought an estimated revenue requirement of Rs1.274 trillion, including Rs545.28bn in unrecovered shortfalls from previous years.

Karachi-based SSGCL supplies gas to consumers in Sindh and Balochistan, while Lahore-based SNGPL provides gas to consumers in Punjab and Khyber Pakhtunkhwa.

Published in Dawn, August 1st, 2026