Gas price increase plan following electricity bomb

ISLAMABAD: The Ministry of Petroleum has outlined a proposal to escalate gas prices by 55-60 percent as part of an initiative to address the persistent debt within the gas sector, following a recent electricity-related crisis.

Pending approval from the federal cabinet, the scheme aims to establish a unified national gas price across the entire country, determined by the weighted average cost of gas.

This move would result in a uniform gas price for all consumers, regardless of their geographic location.

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Presently, local gas is priced at $8 per mmbtu (million British thermal units), while imported LNG (liquefied natural gas) stands at $13 per mmbtu.

The plan seeks to bridge the existing $5 gap between these two price points, thereby contributing to the reduction of the ongoing debt burden in the gas sector.

The strategy also encompasses measures to curtail the consumption of LNG for fertilizer production.

At present, fertilizer manufacturers enjoy a subsidized rate for LNG usage; however, the proposed plan mandates that they pay the full market price for LNG.

Following endorsement from the federal cabinet and consultations with the provinces, the plan’s execution is slated to commence.

Anticipated to roll out in the forthcoming months, it is poised to exert a notable influence on gas consumers, leading to an upswing in their utility bills.

Nevertheless, the government contends that this course of action is indispensable to mitigate the prevailing debt crisis in the gas sector and ensure the industry’s long-term viability.

The masses are already bearing the burnt of inflated electricity bills, now the anticipated increase in gas bills will increase their worries as well as leave a deep hole in their pocket.