KARACHI, Dec 8: Consumers in the megapolis are yet to see any cut in retail price of liquefied petroleum gas (LPG) despite the fact that the Jamshoro Joint Venture Company Limited (JJVL), which is meeting 26 per cent LPG demand of the city, has reduced its price by Rs4,000 per ton two days back.

The company is presently supplying 40 tons per day and the total daily consumption of the city is estimated at 150 tons. The rate in the mega city is hovering between Rs58-60 per kg.

In sharp contrast to Karachi, a senior executive of JJVL claimed that the retail rate of gas in Punjab had come down to Rs56 per kg from Rs60 after the company cut its LPG prices on December 6.

Director JJVL Fasih Ahmed told Dawn from Lahore that it had been surprising that the rates in Karachi had not fallen despite the cut. “It seems that distributors have still been operating on higher margins”.

He said he had asked the distributors that retail price in Karachi should not exceed Rs55 per kg but it had not happened. The retail rates should come down by Tuesday.

Out of total daily domestic production of 1,800 tons, JJVL produces 450 tons a day and its supplies to Punjab and Northern Areas stand at 350 tons a day followed by 100 tons in Sindh. The company, which holds 30 per cent market share, is providing 11.8-kg cylinder at Rs595, he elaborated.

Auto sector (rickshaws, taxis, commercial vehicles and private car owners) eat up 70 per cent of the total daily LPG production while 20 per cent is consumed by domestic and commercial consumers and 10 per cent by various industries, he said.

LPG Distributors Association of Pakistan chairman Hadi Khan contested the figures and said that Karachi’s per day consumption ranged between 300-350 tons a day in which JJVL’s share was 30-40 tons and the company’s main supplies were destined for upcountry.

He said even LPG produced by Parco was hardly being used in the mega city which mainly consumes gas arriving from OPI, Boby Field, Bosicor, National Refinery Limited (NRL) and Pakistan Refinery Limited (PRL) and JJVL.

Currently, the cylinder prices range between Rs620-630. He said prices of 11.8 kg cylinder would have gone up by Rs77 per cylinder to Rs720 in case the increase in prices made by Pak Arab Refinery Limited (Parco) would have not been reverted.

He said no price had been increased when Parco had announced increase in gas rates by Rs6,584 per ton. However, he said distributors had projected an increase of Rs7 per kg.

Hadi was of the view that the auto sector consumed 40pc of the total LPG production and commercial usage stood at 40pc while household was consuming 20 per cent for burning purposes.

Parco, a company partly-owned by the government, created a stir in the market on December 4 by pushing up the rates by 14 per cent after the de-regulation of LPG prices. After heavy pressure from LPG players and government’s intervention it had to reverse its decision.

Recent unpleasant changes in the LPG pricing mechanism, after its de-linking from Saudi Aramco Contract Prices, has drawn severe criticism from consumers who feel that gas producers, marketing companies and distributors enjoy a free hand in playing havoc with the prices and the government has become a silent spectator.

Considering the fact that auto sector takes away major chunk of total LPG production, it is believed that commuters suffer heavily when they take extremely costly ride by paying exorbitant fares on the demand of rickshaw and taxi drivers.

Rickshaw owners are now charging at least Rs50-60 for three to five km as against Rs30-40 six months back and they charge Rs170-180 on 12 km journey as against Rs120-150.