In a recent decision, the federal government has raised the prices of Liquefied Petroleum Gas (LPG) for September 2024, adding further strain to households already grappling with high inflation rates. The increase, announced on Saturday, reflects a significant adjustment in LPG pricing, which directly impacts consumers across the country.
New LPG Pricing Details
According to a notification from the Oil and Gas Regulatory Authority (OGRA), the price of LPG per kilogram has been increased by Rs6.99. This adjustment translates into a rise of Rs82.54 for a standard domestic cylinder, which has a capacity of 11.8 kg. As a result, the new cost for a domestic LPG cylinder is now Rs2,879.10, compared to Rs2,796.56 in August.
| Product | August 2024 Price (Rs) | September 2024 Price (Rs) | Increase (Rs) | Percentage Increase |
|---|---|---|---|---|
| LPG per kg | – | – | Rs6.99 | – |
| 11.8 kg Domestic Cylinder | Rs2,796.56 | Rs2,879.10 | Rs82.54 | 2.95% |
Factors Contributing to the Price Hike
The adjustment in LPG prices is influenced by several factors related to international market dynamics and exchange rates. Specifically:
- Saudi Aramco Contract Price (CP): The price of LPG is closely linked to the Saudi Aramco CP, which has increased by 3.63% from the previous month. Saudi Aramco CP is a benchmark for the cost of LPG in global markets.
- US Dollar Exchange Rate: The average exchange rate of the US dollar has seen a slight increase of 0.046%, which impacts the cost of imported LPG and, consequently, the domestic prices.
| Factor | Previous Month | Current Month | Change | Percentage Change |
|---|---|---|---|---|
| Saudi Aramco CP | – | Increased by 3.63% | – | 3.63% |
| US Dollar Exchange Rate | – | Increased by 0.046% | – | 0.046% |
Implications for Consumers
The increase in LPG prices comes at a time when many consumers are already facing financial hardships due to rising inflation. The price hike will have a direct impact on household budgets, particularly for those who rely on LPG for cooking and heating. The additional Rs82.54 on a standard domestic cylinder adds to the cost of living and exacerbates financial pressures on families.
Government and Regulatory Responses
OGRA’s notification outlines the reasons behind the price adjustment, emphasizing the role of international price trends and currency fluctuations. While the government has adjusted the prices to align with global market conditions, the move has been met with concern from the public and advocacy groups, who argue that such increases contribute to the growing cost-of-living crisis.
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