LPG prices hiked by Rs45.18 per cylinder for December

• Govt cites rise in dollar exchange rate for hike. 
• LPG prices increased to Rs254.86 per kg. 
• Price of commercial cylinder to increase by Rs173.882.

ISLAMABAD: Citing a rise in the average dollar exchange rate, the caretaker government hiked the prices of liquefied petroleum gas (LPG) by RsRs3.83 per kilogram for commercial and domestic consumers for the month of December, The News reported. 

The Oil and Gas Regulatory Authority (Ogra) notified that the LPG prices increased to Rs254.86 per kg from last month's price of Rs251.03, affecting various cylinder sizes differently.

According to Ogra, the LPG producer price is tied to the Saudi Aramco-CP and US dollar exchange rate, which remained unchanged compared to the previous month. However, the average dollar exchange rate increased by 1.87%, leading to a Rs45.18/11.8 kg cylinder (or 1.5%) rise in LPG consumer prices.

Post-hike, the price of a domestic cylinder has increased by Rs45.18/11.8kg, from Rs 2,962.17 in November to Rs3,007.35. Simultaneously, the price of a 45.4kg commercial cylinder will increase by Rs173.882.

Ogra has determined the producer price of LPG, assuming a composition of 40% propane and 60% butane, to be Rs176,314.44 per tonne. This price includes an excise duty of Rs85 per tonne, excluding the petroleum levy of Rs4,669 per tonne.

Consequently, the total cost for an 11.8 kg cylinder amounts to Rs2,080.51. Before the imposition of an 18% general sales tax (GST), the producer price would have been Rs180,983.47 per tonne, resulting in a price of Rs2,135.60/11.8kg cylinder. The GST on Rs180,983.47 per ton would have been Rs32,577.02 per tonne or Rs384.41 per 11.8 kg cylinder.

Furthermore, OGRA has calculated a maximum producer price of Rs213,560.49 per tonne or Rs2,520.01 per 11.8 kg cylinder. The marketing, distribution, and transportation margin have been set at Rs35,000 per tonne, comprising a marketing margin of Rs17,000 per tonne, distribution margin of Rs10,000 per tonne, and transportation margin of Rs8,000 per tonne, resulting in a total margin of Rs 413 per cylinder.

Consumers are also subject to an 18% GST of Rs6,300 per tonne or Rs74.34 per 11.8 kg cylinder on the marketing and distribution margin of Rs 35,000 per tonne.

In September, the caretaker government increased the LPG price by Rs39 per kilogram (19.37%), and in October, the prices rose by 8.7% or Rs 20.86 per kilogram. However, in November, the prices decreased by Rs9.95/kg.