LPG pricing gaps raise market concerns

Pakistan’s authorities have identified major gaps in the liquefied petroleum gas (LPG) pricing system, with officials warning that the existing formula is causing market distortions and large differences between notified and actual prices.

The issue was discussed during a meeting of the National Price Monitoring Committee (NPMC).

The Oil and Gas Regulatory Authority (Ogra) and the Petroleum Division briefed the committee on the existing LPG pricing mechanism.

Officials said the difference between the official price and the price being charged in markets was mainly linked to the exclusion of import parity from the current pricing formula.

The committee was informed that changes to the LPG pricing policy had remained pending since 2023.

The Petroleum Division said the original pricing framework had been designed primarily for domestic LPG producers. The same framework was later applied to importers.

Officials said this created distortions in the market. It also resulted in significant differences between the notified rate and prices paid by consumers.

The gap is particularly visible in areas close to the Iranian border.

In Gwadar, LPG was being sold for around Rs330 per kilogram. In Turbat, the price had reached approximately Rs350 per kilogram.

The committee was told that these market prices were significantly higher than the rate notified by Ogra.

The meeting agreed that the petroleum ministry, in consultation with Ogra, would examine the issue and take steps to address the difference between official and market LPG prices.

The meeting also examined the quality of essential food items, including edible oil, ghee and milk.

The Ministry of Planning briefed the committee on testing conducted by the Pakistan Council of Scientific and Industrial Research (PCSIR).

The results raised concerns over the quality of several tested samples.

Tests of edible oil and ghee found elevated levels of trans-fatty acids, peroxide value and free fatty acids.

Some samples also failed to meet prescribed requirements for Vitamin A fortification.

Milk samples also showed widespread non-compliance with required standards.

The testing indicated lower-than-required levels of protein and fat in several samples.

The committee expressed concern over the quality of essential food products. Particular attention was drawn to the situation in rural areas.

Officials warned that the consumption of substandard food products could create serious health risks.

The chief nutrition officer proposed a national testing system for essential food commodities.

The proposed framework would involve relevant federal and provincial stakeholders.

Officials suggested that essential food products should undergo mandatory testing every quarter.

The results would then be presented regularly before the relevant monitoring forum.

Food and agriculture consultant Dr Mubarak Ali supported the proposal. He also called for strict measures to ensure compliance with quality standards.

The chief economist suggested that the Ministry of National Food Security and Research convene a meeting with manufacturers and industry representatives.

The proposed meeting would include producers and associations representing edible oil, ghee and packaged milk.

Representatives from the Ministry of Science and Technology and provincial governments would also participate.

The chief economist further proposed that PCSIR conduct random tests every quarter to verify the consistency of the findings.

After discussion, the NPMC directed the Ministry of National Food Security to meet representatives of the relevant industries.

The ministry was given 15 days to discuss the test results and take corrective measures.

The committee also decided to develop a comprehensive national framework for regular quality checks.

The framework will cover edible oil, ghee, milk and other food commodities.

The food ministry will coordinate with the ministries of commerce, industries and production, and science and technology.

Provincial and regional food authorities, the Islamabad Capital Territory administration and other stakeholders will also be consulted.

The NPMC also took up concerns regarding medicines available in the market.

The Ministry of National Health Services, Regulations and Coordination was directed to examine reports about the quality and high prices of drugs.

The ministry will submit its findings to the committee.

Meanwhile, the chief nutrition office was instructed to forward the PCSIR findings and recommendations on edible oil, ghee and milk to the Economic Coordination Committee.

The latest decisions reflect growing official concern over LPG price disparities and the quality of essential consumer products.