ISLAMABAD, Nov 3: The Oil and Gas Regulatory Authority (Ogra) on Saturday increased the base price of liquefied petroleum gas (LPG) by $83 per ton (14 per cent) with immediate effect.

The government’s move is expected to increase the LPG retail price in the range of Rs5 to 15 per kg. This increase will be different in various cities :--t Lahore Rs62 from Rs56 per kg; Karachi Rs59 from Rs53 and Gilgit Rs75 from Rs69, respectively.

According to a notification issued on Saturday, the Ogra fixed LPG base price at $655 per ton, up from $572 per ton, which excluded taxes. The government had frozen increase in the base price of LPG for the month of October last.

LPG Distributors and Welfare Association Chairman Hadi Khan from Karachi told Dawn that this increase would heavily affect the end consumers, who have no other alternative for fuel.

He demanded that the government should freeze the increase in LPG till February 2008 when the price stabilizes in the international market.

He was of the opinion that it would encourage smuggling of LPG from Iran, which would not only deprive the kitty of the taxes but would also damage local businesses.

“The government policy is morally repugnant and we strongly condemn this unwarranted and unjustified LPG price increase,” said Fasih Ahmed, spokesman for the LPG Association of Pakistan (LPGAP), a grouping of all LPG marketing companies.

Local LPG production accounts for 95 per cent of Pakistan’s total LPG availability. The LPG producer pricing policy in place since last January has artificially linked local production prices to Saudi Arabian export prices. The decision led to an insignificant net increase in imports, historically-high prices across the value chain, and a sharp slump in demand for LPG throughout the country.

LPG Distribution Association secretary Muzzamal Abbasi in a statement said that the recent hike in LPG base price would seriously affect consumers, the taxi drivers. He said that an increase of Rs26,230.15 per ton has been witnessed during the last 19 months.

He said that with this increase the 11 kg cylinder witnessed an increase of Rs309 each during the period under review.

The association said that the present government had linked the local base price of LPG with international market to please ‘one influential person’ at the cost of poor consumers. He said out of total 63 LPG marketing companies, 62 were the worst affected.