The Oil and Gas Regulatory Authority (OGRA) has recently announced an important change in the pricing of indigenous Liquefied Petroleum Gas (LPG) for the month of April 2025.
According to the notification issued on March 31, 2025, OGRA has raised the price of LPG by Rs. 0.54 per kg.
This price hike has led to an increase of Rs. 6.40 for the standard 11.8 kg domestic LPG cylinder, bringing the new consumer price to Rs. 2,930.71 for April 2025, compared to Rs. 2,924.31 in February 2025.
Why Has OGRA Increased the Price of LPG?
OGRA’s role in regulating energy prices, including LPG, is vital for maintaining a balance between affordability for consumers and the sustainability of the energy sector.
The cost of producing LPG is directly linked to international crude oil prices, as LPG is derived from crude oil refining processes. When global oil prices rise, production costs for LPG also increase, which in turn drives up the domestic price.
OGRA has highlighted that the combined marketing, distribution, and transport margins stand at Rs. 35,000 per metric ton.
These additional costs also contribute to the overall increase in LPG prices, impacting consumers directly at the retail level.
OGRA frequently reviews LPG pricing to ensure that it aligns with the actual costs incurred by producers and marketers. Adjustments are made based on global oil price trends, exchange rate fluctuations, and other market conditions.
How Does the LPG Price Increase Affect Domestic Consumers?
The rise in LPG prices by Rs. 0.54 per kg means that the cost of a typical 11.8 kg domestic LPG cylinder for April 2025 has increased by Rs. 6.40. While this may seem like a small increase on the surface, it can significantly affect household budgets, particularly in areas where LPG is the primary source of cooking fuel.
For lower-income households, where every penny counts, such increases can create financial strain. Moreover, the increase in LPG prices comes at a time when consumers are already grappling with inflation in other essential goods and services.
Another important consideration is the regional variation in LPG prices. In rural and remote areas, where transportation costs are higher, LPG prices are often more expensive than in urban centers.
This price discrepancy can be even more burdensome for those living in rural areas, as they may already face limited access to affordable energy alternatives.
The Broader Impact of LPG Price Increases on Pakistan’s Energy Sector
LPG pricing is intrinsically linked to global energy markets, particularly crude oil prices. When global oil prices fluctuate, it directly impacts the cost of refining LPG, as well as the cost of transportation and distribution.
OGRA’s regular price adjustments help mitigate the impact of such fluctuations, but they cannot completely shield consumers from the realities of the global energy market.
Through periodic price reviews and adjustments, OGRA helps ensure that the LPG market operates in a fair and transparent manner.
While price hikes are inevitable due to external factors such as rising crude oil prices or transportation costs, OGRA’s oversight ensures that these price changes do not disrupt the overall balance of the energy market.
For LPG producers and marketers, price adjustments help maintain profitability and ensure that they can continue to supply the market with this essential energy source.
