ISLAMABAD: Jamshoro Joint Venture Limited (JJVL) has called on the federal government to urgently address what it describes as a long-standing distortion in the liquefied petroleum gas (LPG) market, arguing that current regulations force imported LPG to be sold at prices that do not reflect its actual cost.
In a letter dated June 10, addressed to Minister for Petroleum Ali Pervaiz Malik, JJVL Chairperson Iqbal Z Ahmed urged the government to rationalise pricing between locally produced and imported LPG, warning that the existing framework is contributing to supply disruptions and discouraging legal imports.
The appeal comes days after the Oil and Gas Regulatory Authority (Ogra) issued its monthly LPG pricing notification effective June 1, 2026. Under the notification, the maximum price of indigenous LPG has been set as the regulated ceiling price across the entire supply chain for both locally produced and imported LPG.
According to Ogra, the maximum consumer price for LPG in June stands at Rs308,763.89 per metric tonne, equivalent to Rs308.76 per kilogramme or Rs3,643.41 for an 11.8-kilogramme domestic cylinder. The price includes the producer price, petroleum levy, GST, marketing margins, distribution margins and transportation charges.
JJVL, however, argues that the pricing formula does not account for several significant costs incurred by importers. These include freight expenses from Karachi, insurance costs, customs clearance and wharfage charges, terminal handling fees, Port Qasim royalty payments, GST applicable to imported cargo, and letter-of-credit operating expenses.
The company stated that once these costs are incorporated, the actual end-user price of imported LPG rises to approximately Rs4,352 per 11.8-kilogramme cylinder, about Rs709 higher than the maximum price currently permitted under Ogra’s notification.“This creates market anomalies and distortion in pricing,” JJVL said in its communication to the Petroleum Division.
Industry participants have long argued that imported LPG operates under a fundamentally different cost structure from indigenous production. While local LPG prices are linked to a regulated formula based on domestic production economics, imported LPG is exposed to international commodity prices, shipping costs, foreign exchange fluctuations, port charges, and import-related taxes.
JJVL maintained that forcing importers to sell at the same regulated ceiling price as local producers undermines the commercial viability of imports. The company warned that such pricing constraints could discourage imports from established and legal supply sources at a time when Pakistan periodically relies on imported LPG to bridge domestic supply shortfalls.
The company also highlighted another issue affecting the local LPG market. It noted that domestic LPG pricing does not incorporate the cost of signature bonuses and other payments demanded by producers during allocation arrangements. According to JJVL, officials in the Directorate General of Liquid Gases within the Petroleum Division are already aware of these unresolved issues, which have persisted for several years.
As a solution, JJVL proposed that Ogra establish separate pricing mechanisms for indigenous and imported LPG, allowing import-related costs to be transparently passed through in regulated prices. The company further argued that the most effective long-term solution would be broader deregulation of the LPG supply chain.
“Ideally, the entire supply chain of LPG should be deregulated to encourage competition and increase local production for the benefit of consumers,” the company said.The debate reflects a broader policy challenge facing Pakistan’s energy sector: balancing consumer protection with the need to maintain adequate supplies and encourage private-sector investment. Regulators traditionally seek to shield consumers from sudden price increases by imposing maximum price limits, while importers and distributors argue that artificially low price ceilings can discourage market participation and ultimately create shortages.
Ogra’s June notification was issued under the LPG Policy 2016 and related provisions of the Ogra Ordinance and LPG Rules. The regulator reiterated that the notified price represents a maximum ceiling and that producers, marketing companies, and distributors remain free to sell LPG below that level.
The Petroleum Division has yet to publicly respond to JJVL’s latest request. However, the issue is likely to attract attention from policymakers as Pakistan enters periods of higher LPG demand and continues efforts to ensure stable energy supplies across the country.
With imported LPG suppliers warning of narrowing margins and local industry players calling for reforms, the government may face increasing pressure to revisit a pricing framework that has remained a source of contention within the sector for years.
