ISLAMABAD: Liquefied petroleum gas (LPG) prices have surged in Pakistan amid supply disruptions reportedly linked to the closure of the Iranian border and interruptions to imports through the Strait of Hormuz. According to sources at the Oil and Gas Regulatory Authority (OGRA), the situation could worsen further if supply routes are not restored.
OGRA sources said Pakistan imports approximately 70% of its LPG requirements, with nearly half of its total LPG imports reportedly coming from Iran. The closure of the Iranian border has disrupted supplies, putting additional pressure on prices in the domestic market.
Pakistan also imports LPG from Iraq and Oman. However, according to the sources, shipments from these countries have been affected by the closure of the Strait of Hormuz. Officials fear that the domestic shortage could deepen if imports through the Iranian border do not resume.
LPG Cylinders Reportedly Selling at More Than Double the Official Price
Pakistan’s average annual LPG consumption stands at approximately 2.4 million to 2.5 million tonnes, according to OGRA sources. Supply disruptions amid substantial domestic demand have intensified pressure on the market.
OGRA has set the price of an 11.8-kilogram domestic LPG cylinder at Rs3,296. However, reports indicate that cylinders are being sold in various parts of the country at twice that price or even higher.
Meanwhile, OGRA enforcement teams are taking action against sellers charging more than the prescribed price. The measures are aimed at curbing overcharging and protecting consumers from profiteering.
Pakistan Receives Second LNG Cargo from Qatar in October
Amid concerns over LPG supplies, Pakistan has received another cargo of liquefied natural gas (LNG) from Qatar. According to Ministry of Energy sources, the shipment is Qatar’s second LNG cargo to arrive in Pakistan during October, and gas supplies from the cargo have begun entering the national system.
The sources said the government is seeking to meet the country’s gas requirements while avoiding additional purchases from the more expensive spot LNG market wherever possible.
Qatari LNG Available at Nearly Half the Spot-Market Price
Under Pakistan’s long-term supply agreement with Qatar, LNG costs approximately $14 to $15 per million British thermal units (MMBtu), according to Ministry of Energy sources. By comparison, prices in the spot market have reached around $30 per MMBtu.
This means LNG supplied under the agreement is available at approximately half the spot-market price, potentially helping Pakistan contain its import costs.
The arrival of Qatari LNG is an important development for Pakistan’s broader gas supply system as the country faces disruptions and rising prices in the LPG market. However, LPG and LNG are different products with distinct supply chains. Therefore, the arrival of an LNG cargo does not directly guarantee an end to the domestic LPG shortage.
