LPG Associations Call Nationwide Strike From November 16 Over New Pricing Formula

Liquefied petroleum gas (LPG) associations across Pakistan have announced a nationwide strike starting November 16, threatening to suspend sales in protest against a proposed pricing formula they say could raise consumer prices by 25 to 30 percent, according to industry representatives.

Ali Haider, Senior Vice Chairman of the LPG Marketers Association, said all associations rejected the mechanism at an emergency meeting. He added that sales would stop across the country from November 16 unless authorities accept their demands within 15 days.

According to Haider, the proposed mechanism would push LPG prices up by 25 to 30 percent. He noted that roughly 90 percent of the LPG consumed in Pakistan is transported by road in tankers, and that the formula would also raise costs for about 30 percent of locally produced gas.

The Petroleum Division has proposed replacing the current cap based on the Saudi Aramco Contract Price with a benchmark tied to Pakistan State Oil's landed import cost. A broader set of reforms would also allow state-owned companies to import LPG and set prices, taking that role away from the Oil and Gas Regulatory Authority (OGRA). Prime Minister Shehbaz Sharif has already formed a ministerial committee to review the proposed policy changes after industry pushback.

OGRA has notified the official consumer price of an 11.8 kg cylinder at Rs. 3,470.09 for November, an increase of Rs. 173.86. A 25 to 30 percent rise on that figure would add roughly Rs. 870 to Rs. 1,040 per cylinder, bringing the price to about Rs. 4,340 to Rs. 4,510.

Households in many cities are already paying well above the official rate, with LPG selling above Rs. 500 per kilogram in Lahore last week. A nationwide halt in sales could further tighten supply unless the government and the industry reach an agreement before the November 16 deadline.